Investor · FL · Member since 2026 · 10 posts · 3 votes
Hello BiggerPockets community!
I'm relatively new to the Texas tax-deed investment market and recently purchased two properties through a Dallas County tax foreclosure auction. Both Sheriff's Deeds were officially recorded on October 16, 2026.
My question is: Can an investor legally resell a property acquired through a Texas tax foreclosure auction while it is still within the statutory redemption period, rather than waiting for that period to expire?
If so, how are these transactions typically structured? Would a quitclaim deed or another type of deed be appropriate? And how are the original owner's redemption rights and any redemption payments handled after the property is transferred to another investor?
I'd really appreciate hearing from anyone who has experience buying or selling Texas tax-deed properties during the redemption period.
Looking forward to learning from the community and connecting with fellow investors!
I'm relatively new to the Texas tax-deed investment market and recently purchased two properties through a Dallas County tax foreclosure auction. Both Sheriff's Deeds were officially recorded on October 16, 2026.
My question is: Can an investor legally resell a property acquired through a Texas tax foreclosure auction while it is still within the statutory redemption period, rather than waiting for that period to expire?
If so, how are these transactions typically structured? Would a quitclaim deed or another type of deed be appropriate? And how are the original owner's redemption rights and any redemption payments handled after the property is transferred to another investor?
I'd really appreciate hearing from anyone who has experience buying or selling Texas tax-deed properties during the redemption period.
Looking forward to learning from the community and connecting with fellow investors!
Thank you!
@Tony Aramouni, my understanding is that a property may be transferred during the redemption period, but that doesn't automatically remove the former owner's right to redeem it. I'd be careful about choosing a deed or agreeing to a resale until a Texas real estate attorney has reviewed the foreclosure documents and confirmed how those rights would affect the next buyer.
I'm a real estate attorney, broker, and investor based in Maryland, and I work with clients on real estate transactions, contracts, and title matters. One thing I always pay attention to is whether the buyer understands exactly what ownership rights they're receiving and what issues could affect the transaction.
Thanks for bringing this up, @Tony Aramouni! It's an important question, especially when you're purchasing properties through tax foreclosure auctions. Happy to stay connected!
Tony, interesting acquisition. Are you planning to resell both properties as-is, or renovate them before resale? That could make a difference to your next steps.
Hi Judith, thanks for your question! My intention is to sell the properties as-is during the redemption period. With Texas redeemable tax deeds, it's generally best to avoid renovations during that time because if the former owner redeems, the investor could lose the money spent on improvements. For properties qualifying for the two-year redemption period, Texas law provides a 25% redemption premium in the first year or 50% in the second year, calculated on the applicable statutory redemption amount. That's the potential investment opportunity for buyers who understand this type of investment.
While technically you can sell, why would an investor want to pay a price above the purchase price that you paid? In theory, you could sell it at the price paid and the (price plus 25% premium ) that would be due. However, that is a huge risk for the buyer as they would not be able to get title insurance. Very narrow margins at best with this strategy
It’s legal to sell during the redemption period but like @Greg H. said, why would anyone take the chance? I have bought many of these in central Texas and one took 4 years before I could get clear title.
I appreciate your insights, and I certainly understand the title and redemption risks. Both properties are currently owner-occupied and appear to be well maintained, which I believe could increase the likelihood of redemption, although there's no guarantee. My asking premium is only 10% above my acquisition cost, while qualifying Texas homestead redemptions carry a statutory 25% premium in the first year and 50% in the second year. That creates a potential return opportunity for an investor who understands the risks. If the properties are not redeemed, there's also a potential upside based on the spread between acquisition cost, rehab expenses, and after-repair value (ARV). Of course, title clearance, holding costs, and redemption uncertainty all need to be factored into the investment.
Thank you, Ronald. I appreciate your input, especially regarding title insurance and rehabilitation expenses. Those are important considerations with redeemable tax deeds.
Yes, you can with a special warranty / quick claim deed, make sure it’s “as is where is” remember, you can only sell what you have (deed subject to a right of redemption) the pricing will most likely be a discount to redemptive value (the buyer will want a return
Thank you, Justin! I appreciate your insight, and I agree that the buyer would be acquiring the property subject to the existing redemption rights, with pricing that reflects the risks and allows room for a reasonable return. That's exactly the type of transaction I'm exploring, so your feedback is very helpful.
What Most people don’t know about TX , Has a specific statute governing Tax Lien loans ie Property tax loans , transfer of tax liens as governed primarily by Texas Tax Code § 32.06 and § 32.065, alongside licensing and regulatory oversight under Texas Finance Code Chapter 351 (but it’s VERY hard to break into that niche market
Hi Tony, thanks for sharing how you're thinking about these — I'm learning a lot from this thread. Could you share which part of Dallas County they're in, and what you're asking for them?
Hi Chris, Thanks for your interest! The two properties are located in Balch Springs and DeSoto, Dallas County. I'm asking 12.5% above my winning bids, which puts Balch Springs at $102,375 and DeSoto at $143,437.50.
My goal is to leave a reasonable upside for the next investor, who would assume the holding costs and redemption risks. Qualifying homestead redemptions carry a 25% statutory premium in the first year or 50% in the second year. If the properties aren't redeemed, there's also potential fix-and-flip upside based on the spread between acquisition cost and ARV.
Never use a quitclaim in Texas. That doesn't establish ownership, rather disownership. You're basically saying, I don't have any claim or interest in this property. That doesn't mean the person you give it to, does have a claim. Anyone who knows what they're doing probably want a warranty deed or you may want to sell with a special warranty deed. You also probably need to disclose the property was obtained at a tax auction and is still within the redeemable period and sold without title insurance.
You can sell, but I'm guessing you need to discount heavily, because the buyer takes on the redemption liability and other kinds of liability. Chances are you can't sell with title insurance for 2 years after the deed filing date. This is both due to the redemption period and the challenge period. So chances are no loans, has to be a cash deal and you have to find someone who will take on the liability. I would think that is rare around here, unless you just got some kind of screaming deal. I don't think people would buy these at a premium, but who knows. There are plenty of people who buy stuff that don't know the consequences or what they're buying. Most investors will want to see inside them at some point, so at some point you'll want to get the occupants out of the house. I'd probably wait to do that until closer to the end of your 2 year redemption period.
Very few people redeem in Texas so the idea of 25-50% is pretty much a myth. Most people don't understand that. I would guess that fewer than 1-2% redeem. I've bought a lot of tax deeds and I think maybe 2 have redeemed and one asked about it and then disappeared.
By the way, the one in Balch Springs is probably way past time to get a new roof. I'd be surprised if you can get insurance on that one in the current condition? Both those areas, can be pretty tough, but the one in DeSoto looks like a decent buy.
Hi Bruce, Thank you for sharing your thoughts and experience. I really appreciate you taking the time to provide such detailed feedback and valuable insights.