Rental Property Investor · south Alabama · Member since 2018 · 121 posts · 88 votes
I bought my first tax deed this morning at the courthouse auction. I’m going to refer to the owner of the property as ‘Mr. Larry’.
Mr. Larry was delinquent on three different properties, and I purchased the deed to one of them. After doing a bit of research I see now that Mr. Larry died June 2017. I am assuming the properties were left to his family members, since they are still living in all three of them. The total taxes for the property I bid on was $458, and due to a counter bid I ended up paying $1100.
I’m trying to figure out where to go from here since from my researching it seems the sale is likely void. Should I contact the tax assessors office tomorrow to try to get a refund of my money, or should I just let it play out and try to do an ejection after 6 months? Surely Mr. Larry’s sons got the tax notices since they are living at the address listed on the bill. I’m not exactly sure how I can claim possession if the sale was void?
JD, CCIM , Real Estate Broker · Tuscaloosa, AL · Member since 2014 · 1k+ posts · 1k+ votes
8y
@Warren Currier, @William W., Mr. Currier's advice probably works well in Massachusetts, but not Alabama. There is no Treasurer of the Town. You contact the county tax assessor's office, or the revenue commissioner, depending on the county. They were not lame in doing their job. They have no responsibility to figure out who died, who got foreclosed on, who sold their property etc. The new owners are responsible for notifying the tax assessor's office. Leaving a bad review will blow back on you, show you don't understand the process, and make enemies at the county level. They don't have a problem. This is a simple administrative matter that comes up often. Don't stress about it. Please read MY advice. I am the recognized expert in ALABAMA tax sales law, policies, and procedures.
JD, CCIM , Real Estate Broker · Tuscaloosa, AL · Member since 2014 · 1k+ posts · 1k+ votes
8y
@William W. The tax sale is void. You are not entitled to possession. You are not entitled to file an ejectment lawsuit. Go to the tax assessor and have him/her void out the tax auction and refund your money. If you wait more than two years to do this, you will not get your overbid money back, because the statute of limitations will have expired on that.
It does not matter if Mr. Larry's sons received the notices. They might have received notice in the real world, but because their names were not on the notices, they did not receive legally constitutional due process notice of the auction.
One more queastion, I also purchased a tax deed to another property that is an acre lot in an industrial area. This lot has a shop type building on it that is very overgrown with brush and vines, so much that’s it difficult to gain access to the building. If I were to hire someone to clear the brush, would that qualify as a preservation improvement?
Developer · Union Point, MA · Member since 2015 · 63 posts · 31 votes
8y
You stated: "Mr. Larry was delinquent on three different properties, and I purchased the deed to one of them" Perhaps there are two other people out there contemplating what to do next.
Oftentimes, I will contact the Treasurer of Town and talk to her/him. "Just wanted to get your insight as how we can best handle this" ... with the suggestion that THE TWO OF YOU (you and the treasurer) have an issue and will want to work together to resolve it asap. You need NOT contact the other two parties at all as doing so may complicate YOUR reimbursement. Focus on your 'need a refund!' situation, not theirs.
Write a review of the lame assessor's office and post it online. Be bold to get your money back asap. Don't need to hire anyone to assist you. You need to strike while the iron is hot! Today.
The Treasurer is the one who cuts checks. Get her or him on your side before noon today!
Frame it properly: "You are going to help them solve a problem that they have"
Focus on this one thing first before you start chasing other things.
JD, CCIM , Real Estate Broker · Tuscaloosa, AL · Member since 2014 · 1k+ posts · 1k+ votes
8y
@Warren Currier, @William W., Mr. Currier's advice probably works well in Massachusetts, but not Alabama. There is no Treasurer of the Town. You contact the county tax assessor's office, or the revenue commissioner, depending on the county. They were not lame in doing their job. They have no responsibility to figure out who died, who got foreclosed on, who sold their property etc. The new owners are responsible for notifying the tax assessor's office. Leaving a bad review will blow back on you, show you don't understand the process, and make enemies at the county level. They don't have a problem. This is a simple administrative matter that comes up often. Don't stress about it. Please read MY advice. I am the recognized expert in ALABAMA tax sales law, policies, and procedures.
JD, CCIM , Real Estate Broker · Tuscaloosa, AL · Member since 2014 · 1k+ posts · 1k+ votes
8y
@William W., (FYI, this is my second reply this morning. Read both. The earlier one addressed another person's reply to your post. This on addresses your specific 2nd qeustion.
The question is not whether clearing the jungle qualifies as a preservation improvement, it is whether you are even allowed to recover for preservation improvements at all with that property. If the property contains a residential structure, then you can recover for preservation improvements. It does not seem like your property contains a residential structure. If the property is located within the official boundaries of an urban renewal or urban redevelopment district, then you are entitled to be paid for anything at all you do that increases the value of the property. It does not matter if the property contains a residential structure or not. It can be residential, industrial, commercial, vacant land, etc. In that case, clearing the jungle would almost certainly increase the value.
Rental Property Investor · south Alabama · Member since 2018 · 121 posts · 88 votes
8y
I call the tax assessors office and was told the name didn’t matter, if the taxes weren’t paid it was getting sold. There is a ten day grace period where his heirs can pay the taxes interest free, but after ten days they owe the dues taxes, plus 12% interest on my bid amount. He said after ten days I would get a tax deed in the mail and that I should then take possession of the property.
So far I haven’t heard back from my attorney, but I may just let these ten days pass just to see if someone pays. I’ll worry about the rest after that.
Regarding the 2nd property I mentioned, it’s not residential, so I guess theres no sense in doing much improving. I may just put up some no trespassing signs and ride out the three years if it’s not redeemed.
One more question on property #2. After I take possession of this property, if I were to give written permission for a non-profit 501c-3 organization to use this building for one year, and at a later time it is redeemed, would the redeemer be forced to honor the agreement? Or maybe a lease for a small sum would be better?
Rental Property Investor · south Alabama · Member since 2018 · 121 posts · 88 votes
8y
Wow. It seems like investors really can’t do much at all with these properties until after three years. I would hate to lease it out to anyone if the redeemer can come along and cancel the contract.
I called the tax collectors office today and neither property was paid up during the grace period, so certificates were mailed out yesterday and I will likely receive them tomorrow. The county tax collector stands by his decision that the sale isn’t void.
I also talked to my attorney today and she told me she wasn’t exactly sure the sale is void, however she does feel like I need to notify all heirs and explain the situation. She probated the will of Mr. Larry and will be sending me the contact info of his heirs.
If the county refuses to refund my money, and Mr. Larry’s heirs don’t pay, what are my options?
JD, CCIM , Real Estate Broker · Tuscaloosa, AL · Member since 2014 · 1k+ posts · 1k+ votes
8y
"Notice of sale was given to the Trusses and not the Trusses' grantee who was the title holder at the time of the tax sale. Thus, the subsequent sale was invalid and conveyed no title." Almon v. Champion International Corp., 349 So.2d 15 (Alabama Supreme Court 1977)
The tax collector is wrong. Contact the county attorney and ask him to read Almon.
I talked to the county’s attorney today and he said he doesn’t get into tax deed situations, and then referred me to another attorney. I talked to that attorney and he wasn’t exactly sure if the sale is void or not. I referred to the Almon vs Champion case and he said he’d have to dig into that and of coarse there’d be a charge for his time. So, at this point it looks like the odds of getting a refund are slim. He did say the heirs could fight the sale, but that they would have to hire an attorney and drag it through the courts. My fear with that is that they could sue me for their attorneys fees if the court sides with them.
I’m thinking now I may just contact the heirs and ask them when they’re going to pay. I may have to make some friendly threats that I can do things to make the price go up (like get insurance), and hopefully it’ll motivate them to redeem.
JD, CCIM , Real Estate Broker · Tuscaloosa, AL · Member since 2014 · 1k+ posts · 1k+ votes
8y
@William W., send a strongly worded letter to the heirs by certified and regular mail. Tell them you purchased their father's property at the tax auction, and they will have to surrender possession of the property or you will sue all of them to enforce your rights. Advise them they can, of course, redeem, which would avoid the lawsuit, or they can simply move out and/or get all of Dad's stuff out and sign a release. That usually speeds things up so people go down and redeem right away and the problem goes away.
@William W., Let me know what happens, so I can share it with other investors.
I'm in the same boat. Found out one of mine died and went to Jefferson county and tried to ask/plead for them to void the sale and was told that they don't void them for that reason because the person has heirs.
Also tried to get it voided on another property & that request was denied. The owner isn't dead but appears to be suffering from dementia + addiction (ain't that a mental illness now). Is there no protection for the mentally incompetent? This woman ain't gonna pay and has no children. She got her SS check on the 3rd and got drunk.
@William W., send a strongly worded letter to the heirs by certified and regular mail. Tell them you purchased their father's property at the tax auction, and they will have to surrender possession of the property or you will sue all of them to enforce your rights. Advise them they can, of course, redeem, which would avoid the lawsuit, or they can simply move out and/or get all of Dad's stuff out and sign a release. That usually speeds things up so people go down and redeem right away and the problem goes away.
Hypothetically speaking, what if you do this and the heirs respond with "to hell with this property, you can have it, I ain't paying", empty out the house & surrender possession.
Investor · Opelika, AL · Member since 2015 · 108 posts · 15 votes
8y
@Denise Evans@Anastasia Jordan Do you all have an Alabama attorney who works with or is familiar with tax lien/deed process? I'm looking for one to do an ejectment suite. Also record a transfer of ownership.
JD, CCIM , Real Estate Broker · Tuscaloosa, AL · Member since 2014 · 1k+ posts · 1k+ votes
8y
@Shimira Greene, tax sale attorneys Lee Johnsey at Balch Bingham, Will Hereford at Burr Forman, Walter Scott at Galloway Scott. Ejectments pretty routine by Greg Deitsch at Sirote. They do a lot of them.