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Judicial Tax Sale


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#1 nje_tax

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Posted 19 February 2013 - 03:02 AM

I am getting ready to purchase a property at tax sale. The property that I am interested in is occupied by the previous owners. How can I get them out after the purchase, and do I have to wait for the deed or can I start as soon as I have the bill of sale? I am afraid that if I do not have them removed imediatly, they will destroy the property.

#2 Tax_Counsel

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Posted 19 February 2013 - 05:23 AM

I am getting ready to purchase a property at tax sale.


What kind of tax — federal taxes, state income tax, state real property tax, something else? If it’s a state or local tax, what is the state/locality? It matters greatly exactly what kind of tax it is and how the sale is conducted, as the rules for tax sales vary significantly from one jurisdiction to the next and depending on the type of tax and sale process used. There can be risk in buying at tax sale. If you are not familiar with how this particular type of tax sale works, I strongly recommend you get advised from an attorney who is familiar with these sales so you’ll know what the potential pitfalls are and you’ll have some who can spot problems you might miss.

For example, is there a redemption period for the taxpayer here? If so, you might not be able to kick them out until the redemption period is over. Does the sale extinguish any other liens that may be on the property? If not, you’ll get stuck paying off those liens if you want to get the property free and clear. Have you asked any insurance agents what it will cost to get insurance on the place starting the moment you get a deed to the place?

#3 adjusterjack

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Posted 19 February 2013 - 08:26 AM

I am getting ready to purchase a property at tax sale. The property that I am interested in is occupied by the previous owners. How can I get them out after the purchase, and do I have to wait for the deed or can I start as soon as I have the bill of sale? I am afraid that if I do not have them removed imediatly, they will destroy the property.


Sorry, but there is no such thing as getting them removed immediately. You'd have to go through the proper court eviction process and that could take 4 to 8 months in some tenant friendly states.

And you are right about the risk that the tenants could destroy the property, if it's not already a wreck.

As for insurance, you shouldn't have any trouble getting fire insurance and landlord's liability, it'll just cost you a couple of thousand a year since it's a high risk property. There are several insurance companies that write the coverage liberally but at a price.

You might be able to get the property cheap enough but just make sure you have another $30,000 to $50,000 in the bank to cover lawyer fees and rehab costs. You'll need it.

Warning: Legal issues are complicated. Explanations and comments here are simplified and might not fully explain the ramifications of your particular issue. I am not a lawyer. I do not give legal advice. I make comments based on my knowledge and experience. I guarantee nothing. If you act on my comments without the advice of an attorney, you do so at your own risk.


#4 Guest_FindLaw_Amir_*

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Posted 19 February 2013 - 09:11 AM

To learn more about this subject matter, you may want to read the LawBrain: Tax Sale article as a good resource.

#5 pg1067

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Posted 19 February 2013 - 10:07 AM

I am getting ready to purchase a property at tax sale. The property that I am interested in is occupied by the previous owners.


If you haven't purchased the property, then they are the current owners, right?


How can I get them out after the purchase, and do I have to wait for the deed or can I start as soon as I have the bill of sale?


Why would you expect you will not get a deed at the time of sale? If, in fact, the current owners don't vacate the premises after the sale, you will have to evict them. The specifics obviously depend on the laws of the unidentified state where the property is located.




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