Florida Tax Deed Sale House Has Tenant

Florida Tax Deed Sale House Has Tenant

Real Estate Investor · Trinity, FL · Member since 2013 · 67 posts · 9 votes

So, I've been investing in tax lien certificates in Florida for a number of years and had only my second tax deed application actually make it to auction today. Being as it's been such a rare occasion, I decide to drive by the house - well, mobile home with it's own lot - this morning on the way to the auction. I know that this was an investor owned mobile so when I see a car in the driveway, I assume it's a tenant. On my drive to the auction, I start to wonder why someone would purchase a mobile for $25K in 2007 as a rental property and then not pay taxes from 2007 through 2012 and let it go to auction for just over $4K. This makes me worry that this is going to be a nightmare situation and for the first time I'm hoping that someone bids on this property and I don't end up with it.

Sure enough, no one else bid and the property is stuck to me. I spoke to one of the other investors I knew from the last time I attended the auction and he told me he had driven by and saw a scary character was living there, which made him decide not to bid on this one. He was worried that it would be a nightmare to get the person out of the house.

I would have been so pumped to get a property at auction without additional bidding. Now I'm looking for advice. What do I do from here? Do I knock on the door and find out the situation? Try to get a new lease signed? Ask nicely if he'll leave? Get a lawyer?

My goal would have been to flip this out to a cash investor for a small profit. But now I don't know what to do.

Sorry about the long story. Thanks in advanace!

1Reply
71 views

Most Popular Reply

Ned CareyPro Member
Moderator
Investor · Baltimore, MD · Member since 2008 · 17k+ posts · 13k+ votes
13y

I agree with @Wayne Brooks Knock on the door and talk.

I am often amazed how I can knock on a door and say I am the new owner and tenants let me in and tell me what I want to know without really questioning if I am telling the truth.

If I don't get an answer but it appears it might be lived in I post a notice on the door. The notice says if you do not contact us within 5 days the property will be assumed to be vacant and we will change the locks. It also says do not contact your landlord they no longer own the property and cannot help you.

Not legal advice but that is what I do. Good luck - Ned

See this reply in the discussion

15 Replies

Jump to latestLatest
  • Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
    13y

    knock on the door. It's the only way to get a feel for the tenant. You might be pleasantly surprised, and you'll know where to go from there.

  • Ned CareyPro Member
    Moderator
    Investor · Baltimore, MD · Member since 2008 · 17k+ posts · 13k+ votes
    13y

    I agree with @Wayne Brooks Knock on the door and talk.

    I am often amazed how I can knock on a door and say I am the new owner and tenants let me in and tell me what I want to know without really questioning if I am telling the truth.

    If I don't get an answer but it appears it might be lived in I post a notice on the door. The notice says if you do not contact us within 5 days the property will be assumed to be vacant and we will change the locks. It also says do not contact your landlord they no longer own the property and cannot help you.

    Not legal advice but that is what I do. Good luck - Ned

  • Real Estate Investor · Trinity, FL · Member since 2013 · 67 posts · 9 votes
    13y

    @Wayne Brooks

    @Ned Carey

    I'm going to stop over this weekend and see what's going on. I was reading in the Florida statutes for tax deed sales that:

    197.562?Grantee of tax deed entitled to immediate possession.—Any person, firm, corporation, or county that is the grantee of any tax deed under this law shall be entitled to the immediate possession of the lands described in the deed. If a demand for possession is refused, the purchaser may apply to the circuit court for a writ of assistance upon 5 days’ notice directed to the person refusing to deliver possession. Upon service of the responsive pleadings, if any, the matter shall proceed as in chancery cases. If the court finds for the applicant, an order shall be issued by the court directing the sheriff to put the grantee in possession of the lands.

    So I'm hoping that if there's an issue with this guy that it's not as hard as I thought to get him out. I'm not sure if the other laws that have been put in place to protect tenants impacts the Florida statute at all. So if I have any problems, I guess I'll need to speak to a lawyer.

  • Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
    13y

    The Writ Of Possession varies a little bit, county by county. The Federal protection for tenants deals with mortgage foreclosures, and shouldn't be an issue here, I believe.

  • Real Estate Investor · Saint Petersburg, FL · Member since 2013 · 1k+ posts · 951 votes
    13y

    The tenants in foreclosure act doesn't apply to tax deeds so the tenants at your new property are not protected by that. The statue you referenced is the law for tax deeds in FL. I'd definitely try to work it out before you start down the road of having them removed. Just because the guy "looks scary" doesn't mean it's a lost cause and he may very well want to stay there and pay rent.

    If it comes down to needing an attorney I can recommend one I use in Tampa that I use for my quiet title actions who is very familiar with tax deeds.

  • Real Estate Investor · Trinity, FL · Member since 2013 · 67 posts · 9 votes
    13y

    Thanks everybody. @Wayne Brooks that's what I was hoping.

    @Patrick L. thanks for the info and the offer. I might take you up on it. I'll see how it goes this weekend, but I might just want to flip this thing out as quickly as possible.

  • Ned CareyPro Member
    Moderator
    Investor · Baltimore, MD · Member since 2008 · 17k+ posts · 13k+ votes
    13y

    Just today I knocked on the door of a house that we took in tax sale. The tenant let us in so we could see the house. She told us she was a section 8 tenant, who and how many people lived there, the amount of the rent and showed us a water bill. All of that just because we said we were the new owners.

    If I were a crook I would just knock on doors and say I am the new owner send the rent to me. I bet people would do it.

    Is your plan to sell the property or would holding it as a rental fit your goals. You may be able to work something out with the current tenants.

  • Real Estate Investor · Trinity, FL · Member since 2013 · 67 posts · 9 votes
    13y

    @Ned Carey I'm looking to sell it. I've listed it on Zillow, Postlets, and Craigslist. The guy in there wasn't scary at all. He's an Vietnam Vet living on social security. Really, he's getting the short end of the stick here. The last owner had him move in for $350/mo in rent a couple of months ago and this guy was going to be fixing it up for him. I assume the old owner was going to try and sell it but never got to it before the auction. He called the old owner because the foreclosure auction sign was posted in the yard and he was told not to worry about it. Then the old owner stopped over and pulled the sign out of the ground.

    Best scenario would be finding an investor to buy it who wants to let this guy stay and keep the same deal he had with the last owner. Otherwise, I can try cash for keys or go through the court for a writ of assistance to get him out. This has been quite an adventure.

  • Real Estate Investor · Saint Petersburg, FL · Member since 2013 · 1k+ posts · 951 votes
    13y

    @Stefan K. Did it look like the guy had actually done any work to fix it up? Generally in those situations the people that rent them are Ok with in living in squalor and don't ever get around to actually fixing it and obviously the previous owner didn't care that much whether the work got done or not if he wasn't even willing to pay the taxes. If he's actually improving the property then there might be a deal there for an investor, otherwise with taxes, insurance, repairs and general overhead involved in a rental it's not really worth messing with something that only brings in $350 month.

    The other issue with selling it is you won't be able to sell it with anything other than a quit claim deed for 4 years unless you double a couple grand and 2-3 months on a quiet title action and that may also scare away potential investors.

  • Real Estate Investor · Trinity, FL · Member since 2013 · 67 posts · 9 votes
    13y

    @Patrick L. - he's done minimal work right now. Started priming the walls in one of the rooms and some other work in one of the other rooms.

    The real selling point on this property is the land and the fact that is has water and sewer at a very low price point (not sure how much info I can give here without moving over to the Marketplace). I've seen these types of properties get quiclaimed to investors who build mobile home buy and hold portfolios. So, I'll see where this goes with the handful of responses I've gotten so far. If I just can't move it, I'll have to figure something else out.

  • Real Estate Investor · Trinity, FL · Member since 2013 · 67 posts · 9 votes
    12y

    @Wayne Brooks Wanted to give an update and thank you for the great advice.

    The guy living there didn't do much in the way of fixing it up, but the owner wasn't keepin up his end of the deal. Either way, he found a new place and moved out last weekend. I helped him out with his deposit on his new place (much cheaper hiring a lawyer and filing a writ if he wouldn't move out). He asked me to call him the 4th of each month to see how much of it he can pay back that month. I told him not to worry about it but he insisted.

    Now I just have to get it sold!

  • Real Estate Investor · Saint Petersburg, FL · Member since 2013 · 1k+ posts · 951 votes
    12y

    @Stefan K. I'm glad you were able to get him out of there easily. Now you can get the please cleaned up a little bit and maximize your value. I bet a big reason nobody bid at the auction is because it's often not worth dealing with a real low end property that's occupied. Now that's it's empty you should have a much easier time selling it. Just remember you will still have to give a discount over comparable properties because you can only convey title with a Quit Claim and that will be a big turn off. You just have to find somebody that wants to hold it for 4 years as a rental until they can get marketable title....or pay ~2-2.5k to do a quiet title action.

  • Real Estate Investor · Trinity, FL · Member since 2013 · 67 posts · 9 votes
    12y

    @Patrick L. I'm finding out that I probably need to do quiet title anyway. Having a hard time getting people past the lack of title insurance, even at a discount. I'll give it another week or so, but now I'm 45 days from the sale and with a clean quiet title, might have been almost wrapped up.

    This is the first one that has come my way, so I'm learning a lot in the process, even if I don't make a lot on the sale.

  • Real Estate Investor · Saint Petersburg, FL · Member since 2013 · 1k+ posts · 951 votes
    12y

    @Stefan K. If you're going the quiet title route then I'd say go ahead and try and lock up a buyer now with the closing contingent on the completion of your quiet title action. The attorney I use requires a $1k deposit but will let you wait until your closing to pay your balance if you already have a contract and you can just put it on the HUD that way and not come out of pocket.

  • Real Estate Investor · Trinity, FL · Member since 2013 · 67 posts · 9 votes
    12y

    @Patrick L. - I had a guy who was ready to buy it and he had a title search run. It came back with some credit card and collection judgements against the former owner. Even though the tax sale wipes these out, he became non-responsive. I reached back out this morning and offered exactly what you said above, to put a successful quiet title resulting in the availability of title insurance as a contingency in the contract. We'll see if he responds.

    A lot of other interested buyers just get very confused about the whole thing. So finding someone familiar with tax deeds who is looking for the type of property I have has been very challenging. Finding someone who isn't familiar but OK with the contingency might be just as hard. Like I said - learning a lot!

Join the conversationCreate a free account to reply, vote on answers and follow this thread.