Duluth, GA · Member since 2014 · 47 posts · 14 votes
I've been purchasing Alabama Tax deed properties for several months and I am running out of resources. I continue to receive these price quotes from the State of Alabama for approximately $5k - $7k. Good rental property that may require some cosmetics but a good buy and hold property for $5k - $7k. Can I transfer the price quotes to someone else? If so, what is the process.
Make sure you know the redemption rules in Alabama, and don't over-improve. Even with a tax deed, the former owner can still redeem by paying the taxes plus 12% per annum interest. That redemption period runs for three years after the investor takes possession of the property. If the property contains a residential structure, the former must also pay the value of "preservation improvements" made by the investor, but not additions or upgrades. The investor gets to keep any rents collected up until the redemption.
You must also make sure the tax sale was not void. The most likely culprits are death of property owner before tax sale, or sale of property to someone else but failure to assess in the new owner's name. In other words, the wrong person's name was called off at the auction. If the tax sale is void, the former owner (or heirs) can redeem for the taxes plus interest, but do NOT have to pay you for preservation improvements. Also, you will have to disgorge any collected rents.
@Denise Evans, we just received a tax deed from the State of Alabama for 1 acre of vacant land that sold at a tax sale in 1981. The owner of the property died in 1953 and his wife continued paying the property taxes until it sold for taxes. The wife died in 1986. They had to children. We plan on building on the property in a couple of years but may go ahead and clear the trees soon. Do you see a need to quiet the title at this point? I called to get an idea of cost from a local attorney and he said that it would be around $2,000 to quiet the title. I realize that cost is not at all based on the value of the property but $2,000 seems like a lot of money for just 1 acre of vacant land. Your opinion?
The issue is whether you can get title insurance without filing a quiet title lawsuit. You will not be able to borrow money without title insurance. It will be difficult to get title insurance without a quiet title order. Those online services that say they can get you title insurance without a quiet title order charge you several thousand dollars and then tell you to occupy and use the property for four years, and then get back in touch with them. They use regular title insurance companies. Any company willing to write title insurance after 3 or 4 years of documented possession will do it WITHOUT you having to pay the middle man several thousand dollars.
The $2,000 figure might or might not be reasonable, depending on what it includes. A regular "in rem" quiet title lawsuit is against all known and unknown parties, including unknown heirs. It requires appointing a guardian ad litem, who must be paid by the party filing the lawsuit. GAL fees can usually range from $750 to $1,500, depending on the county and who is appointed by the court. You do not get to choose the GAL, the judge does that. Your legal fee for your own lawyer will be around $750 to $1,000. The court filing fee will be around $250 to $300. The newspaper publication fees can be $200 to $1,000, depending on how long the legal description of the property is. The longer the legal description of the land, the more expensive the newspaper notice will be.
You might need to wait three years after your tax deed to file the quiet title. I think I could successfully argue to a judge that you should not have to wait, because the tax sale was so long ago. But, that argument is not a slam dunk.
If you will have to wait, you might want to put a mobile home on the property, or one of the portable "tiny houses" and use it for three years, and then file your quiet title suit.
If anyone is interested, I've received more price quotes from the State of Alabama. These properties will be available for a limited time. One package expires 7/18 and the other expires 7/27. Let me know if you're interested. Thanks,
Can anyone recommend a property management company to handle tax lien properties owned by out of state investors who have repaired the homes & now want to make available for rent?
I have several Alabama tax deed properties myself. Good properties probably while there still occupied. Would make good rentals tho. Any advise on which way to go on these properties?
Anastasia, I recommend Expert Realty in Birmingham, ask for Tish Weaster. BP doesn't like people giving out phone numbers or email address in public posts. If you google expert realty birmingham al, you can find their contact info. Tish has been through my tax sale classes, understands the issues, and already manages properties for out of state investors.
Anastasia, I recommend Expert Realty in Birmingham, ask for Tish Weaster. BP doesn't like people giving out phone numbers or email address in public posts. If you google expert realty birmingham al, you can find their contact info. Tish has been through my tax sale classes, understands the issues, and already manages properties for out of state investors.
I have a foreclosure property that I purchased in February 2017. The deed was recorded in Fed 2017. The taxes for 2016 were not paid. My property was sold at the tax sale in May but it was sold under the previous owners name for 2600. The taxes owed were only 500. What are my rights. I thought of the property was not sold in my name then the sale is void
@Denise Evans I purchased a foreclosure where the previous owners are dead. I was unaware at closing that 2016 taxes were not paid. Infact I received credit for the prorated amount for 2017. The home was a foreclosure. The previous owners names were called off at the sale. What law makes this tax property sale void. They are telling me that the only time a sale is void in Alabama is if the property description is incorrect or the taxes were not owed. I purchased the property feb 2017. Deed was recorded march 3 2017. Property auctioned may 4th 2017.
Hi Leslie, Hope you are doing fine. I am no lawyer! If you have a deed for the property that makes you the owner if there were back taxes due I think you have the right to redeem if it was sold for taxes if the three years have not expired. You should have an option pay the taxes plus interest. I have a question. Did you go into the county revenue office after receiving your deed? If not you should have when you get the deed a document comes with it informing you to do so to assess the property with an officer. Alabama act 1975
" Section 40-10-21
Upon such assignment it shall be the duty of the assignee or his legal representatives to assess such property as from the date of such assignment.
Should such assignment be made after the third Monday in January, the assignee shall be allowed 30 days within which to assess such property before any penalties for such failure shall accrue." That is all I can say to help.
@Dexter Humphrey i did go into the county and I had to pay 807 to redeem. It crazy to me how they only said parcel numbers and names at the tax sale. Bc no address was provided and the name listed was not the mortgage company but people who died years before the lien existed, I was there and didn't know that was my property being sold. I wonder if there is recourse. I feel like the bank should have made me aware at the time of sale. I paid a closing atny and received my simple warranty deed at closing. In addition at the time of closing the statements section for any monies owed by seller only listed the prorated credit for 2016-17 taxes. I went ahead and paid the 807 bug I thought the sale should be void bc at the time of the auction I was the owner and I thought I had to be notified.
@Leslie Finklea I think we talked about this, didn't we, and you were going to make a claim against the title insurance company because they missed the tax sale when you closed.
As far as what law makes it void, it is a constitutional issue that if notice is not received by the owner before the State takes property, then due process has been violated. If the assessed owner died before the auction, then the true owner (heir or heirs) name was not posted in the newspaper notices nor called off at the auction. That violates due process. The only exception is Jefferson County, which has a specific statute saying that if the parcel id number is correct, then the name being wrong is not a problem. Similar statutes have upheld constitutional scrutiny in federal appeals courts, although the 11th Circuit (the one over Alabama federal courts) has not had an opportunity to address this.
@Leslie Finklea I think we talked about this, didn't we, and you were going to make a claim against the title insurance company because they missed the tax sale when you closed.
As far as what law makes it void, it is a constitutional issue that if notice is not received by the owner before the State takes property, then due process has been violated. If the assessed owner died before the auction, then the true owner (heir or heirs) name was not posted in the newspaper notices nor called off at the auction. That violates due process. The only exception is Jefferson County, which has a specific statute saying that if the parcel id number is correct, then the name being wrong is not a problem. Similar statutes have upheld constitutional scrutiny in federal appeals courts, although the 11th Circuit (the one over Alabama federal courts) has not had an opportunity to address this.
Can you provide a link that cites this statute? I'm not able to successfully google it.
I'm trying to look into this and trying to learn. I've noticed that many county website listings, where tax properties are for sale have unpaid taxes but each year after has been paid. For example, the 2008 taxes are for sale from the state but all the years after that have been paid but the property has not been redeemed. How can the subsequent years be paid and not the prior year? And, then what happens if I buy that tax certificate for 2008 but it's 2017 and all the taxes after 2008 have been paid or are now exempt. Does anyone know? Do you just loose your money if the owner never redeems?
Hello, I'm an investor from Montgomery. In 2012 I bought a property and have been paying the taxes the property was vacant the whole time. cut up a tree that fell in 2015. I got the tax deed after last years tax sale. after i recieved the tax deed i bought doors and locks and locked the property up. the previous owner said he wanted to redeem i told him ok but he would have to pay me for the minor upgrades as well as the taxes. ive waited a year he only offered the past due taxes. this year i made about 14k in upgrades. in the middle of some of the contractors working the previous owner changed the locks and had a lawyer to say that we couldnt continue the upgrades and tried to tresspass me from the property. i went to the county and they said they are in the wrong. i dont know what to do now
I've received more price quotes from the State of Alabama. Send me your email if you're interested. Great opportunity to acquire properties for pennies on the dollar.
@Denise Evans I have been following your posts for about a year now trying to learn as much as possible on how Alabama Tax Sales work. I recently purchased my first property that has a residential home that has been abandoned for approximately 3 years. I purchased the Tax Lien from the Alabama State website, applied for the sale, received the quote, mailed the certified check for the asking price, and just received my payment confirmation with about two weeks to go to receive my Tax Certificate on the property. Today I received a letter in the mail from a local attorneys office who states he represents the Estate of the previous owner, that the Estate is redeeming the recent tax sale, and that I am required by law to fill out this Redemption Affidavit before the Redemption can go through. It goes on to state that once the Redemption goes through the county will then refund my money and interest earned. This affidavit is hand written and I’m curious as to if I am required to have this nortarized and signed? Date of tax sale was 5/08/18 and I purchased on 9/29/17. So it looks as if the person listed as previous owner passed away before the actual tax sale? I am not sure and could never find an obituary article. I’m curious if you have any advise for me on this property I was hoping to be able to keep before signing this Affidavit as it states I am required to send back in 10 days. I just did not want to volunteer my rights away unknowingly.
Thanks!!