Does anyone have experience in buying property that has been adjudicated to the city for unpaid taxes. Once you obtain a tax title to thei property by paying the taxes, how long do you have to wait before you can file for a deed in your name for the property? I'm hearing you have to notify the previous owner first and they have up to 2 years to redeem the property back from you. Is that always the case? I'm having a hard time getting clear answers from the city tax office on this. Some of these properties have clearly been abandoned and the taxes have not been paid for many years.
If the taxes have not been paid for many years, can you pay the taxes and immediately file for a deed on the property if it has clearly been abandoned?
Thanks in advance for the feedback.
Right of Redemption is specific to each State. Additionally, the owner could challenge for "Undue Process" hoping that proper notices were not delivered.
Thanks for the feedback. We have a lot properties here in Louisiana that are left when an elderly owner passes and there is no family around. You have know way to find out who to contact. When you can find contact information it's usually wrong. The record keeping in the city I invest in is not very good, especially for the older neighborhoods.
Great question @Reginald Winn !
This adjudicated property problem is a problem in a lot of places. There's a company that started in New Orleans called Civic Source. Google them. They came up with a private solution that satisfies the monumental task of adequately providing notice to anyone with an ownership interest in the property, to allow you to buy with title insurance. That's only in the municipalities and parishes that are signed on with using Civic Source for the disposition of those properties. They have a very informative website that has tutorials of the basics of how it all works. You can also see the list of where they operate and information on properties that get auctioned off every month!
Moderator's Note: I do not work for them or have any affiliate relationship with Civic Source. :-)
@Robert Leonard Thanks, I was just watching a YouTube video from Civic Source two days ago. I did not check out the website yet to see if they work with Caddo Parish. I will definitely give it a look.
I had a contractor tell me if I have a tax title to a property I can begin rehabbing it. If the owner wants to redeem it, they must pay me the tax amount I paid plus interest and for any improvements I made to the property. I can not find any information anywhere that states that. The Parrish tax page says the owner only has to pay the taxes and fees incurred to redeem the property. That's my concern. I'm hearing too many different takes on this.
Yes civicsource.com great website. Even has a video that explains Louisiana's tax lien and tax deed sales
I'd say do your research on how the title process will work before you purchase on civic source. I know an investor who can't get out of a property because the title company will not write title insurance for what the property would be worth full market value. Apparently First American isn't the title company who is writing the policies on top of it. I'd like to hear any successes if there are any.
i tend to agree with @Michael Gee , these properties can be very tedious and exhausting to comb through, make sure you due your title due dilgence it could be worth your while, keep posting but most of all keep sharing
If it is an adjudication from LA then it is three years time frame for the owner to come forward and pay their taxes. If after three years you have not seen a payment then you can go after the property and take ownership.
@Reginald Winn when purchasing a property at an Adjudicated Tax Sale it usually takes about thirty days to close after the on-line auction has ended. A deposit is paid up front, Civic Source does the due diligence and the auction scheduled is within 45 days. There is an on-line auction with open bidding. Highest bidder wins. I have placed deposits on properties that I did not win. Civic Source is very prompt in returning deposits if you are not the winner.
@Josh Carr The three year redemption period (18 months if blighted) comes into play when purchasing a Tax Lien or Tax Sale Certificate on a property.
I have successfully redeemed a Fannie Mae property that I received a Tax Sale Certificate for taxes paid in 2011. The tax/adjudicated sales are tedious, there are a lot of due diligence and up-front money involved, but in my opinion, they are a solid long term investment strategy.
@Ron Collins Thank you!
@Ron Collins Have you had any high bids with civic source? And what was their post winning process?
This is my first time down this rabbit hole being the winning bidder on a tax adjudicated auction for land in Lacombe, LA with civicsource.com. I was told if I was looking for lending, ASI Federal Credit Union and Gulf Coast Bank will lend on tax adjudicated properties. If looking to sell, Title Stream can close the transaction using WFG National Title Insurance (max cap on policy is 250k) or US National Title Insurance (no policy cap I've been told). Finding a buyer willing to follow in these same footsteps will be the key since the companies who offer services to these types of properties is so limiting.
If I choose to build on the land I will need to request US National to increase my owners title coverage to match my investment to protect myself from further claims on the property.
I was told by an Attorney in New Orleans who specializes in tax confirmation law that I'd need to "quiet the title" to be able to get First National Title to write coverage. His retainer fee was $3500 with no guarantees that it will be possible to effectively quiet the title. His hourly rate was $295 & no way of getting an idea of the length of time or work involved to have an accurate cost to cure. Not only clearing up previous owners, heirs and mortgage companies but also verifying the validity of previous tax sales. He suggested trying to sell the property as-is before laying out the funds to clear the issue.
All education comes with a price and hopefully this will turn out to be a profitable investment and not an expensive life lesson. Finding a Realtor interested in listing it for me has been a process. I'd love to hear if anyone has a success story to share!
See this thread: https://www.biggerpockets.com/forums/561/topics/18...
I'm waiting on a call back from a title company on this issue, but I figured I'd throw the question out here, as well.
I am looking at a few lots in Baton Rouge that were purchased in a Civic Source auction (all three were adjudicated).
My strategy is to drop modular homes on the lots and rent them out (trying to grab low income housing credits if possible in the process). Additionally, I know of an opportunity to make a little extra $$$ in providing a perpetual servitude (10' x 10' with driveway access) on one of the lots to a government entity that is doing a type of surveying in the area.
This is very much still in the idea phase; I do not have anything under contract at the moment. I am just looking into feasibility.
Does anyone know if the adjudicated title would prevent me from working out a perpetual servitude deal like this? Supposedly the title is clean, but with Civic Source themselves seeming to acknowledge there are risks, how "clean" is the title really?
You will have a title with title insurance. The question is, will your lender‘s preferred title company issue a title policy if you ever want to cash out refinance. Or will a buyer’s title company issue a title policy if you ever want to sell? Those are the key questions!
I have zero to offer on the perpetual servitude question?
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