Tax Lien Foreclosure Action - Multiple Lienholders - Alabama OTC Tax Lien
Alabama has now implemented the new tax lien system and many are left wondering how it really works, especially with the OTC tax liens. When multiple liens have been issued on a property, we now see multiple lienholders for the same property. This fractional interested ownership is truly a turn off. Now what happens when one of the lienholders want to file a foreclosure action after the three mandatory year period?
1) Does this lienholder have to buy the liens purchased from previous lienholders, before filing the foreclosure action? If so, what is the process or worse, what if the other lienholder refuse to sell?
OR
2) Can the lienholder who wants to proceed with the foreclosure action proceed and then pay the previous lienholders back, their investment + 12%?
It is so unbelievable to see that there is little to no information on the subject. Even calling the Counties is to no avail because they all say the same thing: we do not know. I keep hearing that no one has yet foreclosed on a tax lien yet since the system is so new in Alabama, however, investors need to know what is the proper way to do it, especially when there are multiple lienholders for the same property.