What Happens if Your Home Does Not Sell in a Tax Foreclosure Auction? Do You Still Owe Back Taxes?
What Happens if Your Home Does Not Sell in a Tax Foreclosure Auction? Do You Still Owe Back Taxes?
When you don’t pay property taxes, for example, your real property may end up on the auction block. State, county, or local governments - in short, anyone who can assess taxes - may take and sell your property to satisfy your outstanding debt.
Having your property seized is bad enough, but there’s a possibility that your property doesn’t sell at auction. This creates a new set of issues: namely, can you get the property back, and do you still owe taxes?
No Sale is Still a Sale
Section 34 of the Texas Tax Code governs tax foreclosure auctions. The purpose of an auction is for an agency to recoup any unpaid taxes. In some situations, a property may not sell, or the highest bid is lower than the unpaid taxes. The agency may then choose to terminate the sale.
Alternatively, the agency may not terminate the sale, and the property will be “struck off” by the agency. This means that the agency owns your property, deed and all. This includes the use and possession of the property.
Even if the agency takes the property, it may still file a lien against taxpayers. This can be for any outstanding amount, such as any post-judgment taxes, penalties, and interest.
If My Property Doesn’t Sell, Is There Any Way for Me to Get It Back?
Yes. A property owner’s right of redemption overrides the agency’s title and interest in the property.
Redemption is the legal term for a property owner satisfying their tax debt and reclaiming their title to a property. The specifics of redemption depend on the type of property.
For example, an agency seizes a taxpayer’s primary residence, and that property doesn’t sell at auction. The taxpayer has two years from the date the agency filed the deed to exercise their right of redemption.
Hire a Skilled Property Lawyer Who Knows Texas
If you’re facing the possibility of a property auction or have fallen behind on property tax payments, a skilled Texas property law attorney can help. The attorneys at Manfred Law help Texas property owners resolve property issues. Call us at 713-547-5460 or contact us online to schedule your consultation.
