alabama tax certificate with an alabama medicare lien

14 Replies

At the tax sale I purchased a tax lien certificate in Alabama with an Alabama Medicare lien on it. Do I have to pay the Medicare lien off if I'm only planning on just renting the property out and not planning to ever sale the property with a quiet title action suit?

Medicare can redeem from the tax sale. Their lien is not enforceable unless they redeem. You should send them a certified letter, return receipt requested, telling them  you purchased this property at the tax sale. They have one year after receipt of that letter, or 3 years after the tax auction (whichever is longer) to redeem. If they do not redeem within that time period, they no longer have any redemption rights, either.

Does the country type not send out certified letters to lien holders?

If there is no Alabama law requiring the county to notify Medicare then they lose their Lein once you get the tax deed and there should be no requirement for you or anyone to notify them if the county is  not required to do so. You can double check with an attorney. I'm the sure the local deliquent tax office nows the law on this very well.

If their Lein will not survive after a tax deed is issued and there are no legal requirements to inform then, then I see no point in letting them know if your end game is to own the property.

If i were you..plan on being the one to have to pay the lien, set aside the funds just in case they come forward.  This is part of due diligence on buying property w liens attached.  

I have bought the tax liens with the Medicare liens and once I sent them a letter I requested they either redeem or send me a release each time they sent me a release of lien  Hope this helps

Me Brown Was any of the medIcare liens for a large amount?

yes had some small 5-10k then some over 60-80k  

thank you. I have to leave mobile next week going back to work on a ship.  I hope to be back in mobile around the end of April . Do you invest in mobile ? Do you go to the tax sale in mobile? Thank to Denise Evans I found out that mobile tax sale this year is May 8th. She also have a very good book and class on Alabama tax investing. 

Yes I have read her book I do buy and sale in Mobile get with be glad to help out

@Bernard Braithwaite , you have no reason to know this, being in CT, but Alabama tax sale law is different from almost every other state.  In Alabama, a lienholder must redeem from the tax sale before it can exercise any rights under its lien--foreclosure, execute on property, garnish rents, etc.  The ONLY liens a tax sale investor in Alabama needs to worry about are local government liens. Those are nuisance (grass cutting liens), demolition, sewer assessments, lighting assessments, library dues and fire association dues. Those trump the tax sale sale. If they foreclose on their liens, they must pay the tax sale investor for taxes and interest, but they do not have to pay for post-sale improvements or casualty insurance premiums.  All other liens, including mortgages, IRS, Alabama Department of Revenue, Medicaid, judgments, etc. must redeem from the tax sale investors.

@Billy Brown , how long ago did you buy my book? You are not on my current customer list, which goes back two years. There have been SIGNIFICANT changes in the law since 2014.  You don't need to buy a whole new book, but it might be a good idea to come to one of the seminars in your area to see what is new, or at least cruise through my blog posts (from my website, not the BP blog) to get up to date.

@John Underwood , I know you are out of state, I'm just letting you know this in case you or friends or relatives invest in Alabama.  Alabama law specifically requires the holder of the tax sale rights to notify all lienholders of the tax sale, and provide contact information. This starts the clock on a one-year redemption right for the lienholders. If they do not redeem within that year, they lose all rights as to that property.  Some states provide pre-auction notice to lienholders. Alabama does not, so the post-sale notice system is designed to protect lienholders' due process rights regarding losing property without notice and opportunity to protect themselves.

@Denise Evans I has a Real estate partner that bought it and gave it to me Great content im following up on your stuff now would love to come to event when will you be in south alabama again

@Billy Brown Denise Evans having a tax sale class in Mobile March 11. Get in touch with her for more information 

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