what happens if i did not paid the property taxes of 07/08 to 06/09, and my house is in ashort sale. Do i?

Asked by Melisa, Frederick, MD Fri Feb 6, 2009

Do Ihave paid the taxes or my income taxes will put the amount out from there?

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Cathy Chapman, Agent, Frederick, MD
Tue Apr 14, 2009
Hi Melisa,

When someone does not pay their taxes, regardless of whether the property is in a Short Sale or not, that property falls into a system whereby the property goes up for sale through the county as a TAX SALE. This happens the second Monday in May in Frederick County. The county needs their money whether it's from you or an investor. If an investor pays the taxes, you will have to pay him back plus interest and I think the interest is over 7%.

Information about properties up for TAX SALE will be posted on April 20, 2009. May 11, 2009 is the sale date.

Often times when someone dies and there are no heirs, a property will go into this system and that is how some investors get rich - by buying property at tax sales. The homeowner or their heirs have 6 months to pay back the person who paid the taxes at the TAX SALE plus interest. Once they pay back whoever bought the property in the tax sale, they then redeem the property into their ownership. If a homeowner or their heir or the lien holder does not pay the taxes, the person paying the taxes then files to take ownership of the property.

When a property is in Short Sale, the lien holder will have staff that keeps their eye out for this and will pay the taxes on the owners behalf to keep it out of a TAX SALE. HOWEVER, sometimes the lien holder drops the ball and does not catch this and it falls into the TAX SALE system. As I said, TAX SALES occur in the spring. Below is the link to Frederick County so you can see what happens. As I said, TAX SALES are held the second Monday in May in Frederick County.


Good luck!

Cathy Chapman, Broker
Signature Home Sales, LLC
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Jonathan S T…, Agent, Columbia, MD
Fri Feb 6, 2009

I am Jon Tucker with RE/MAX 100. The gov't will hunt you down and shake you upside down! Just kidding!

If the bank has approved the short sale and takes it to settlement, they will bring all taxes, water bills, and any other liens current as of the day of settlement. Otherwise they cannot transfer "free, clear, and marketable title" to your buyer. They will have to approve the final HUD-1 generated by the title company indicating all of those prorations paid up to that day and your bottom line will be zero. You will not have to bring money to the table unless you have agreed to do so already. Sometimes sellers do agree to bring funds. Usually in a short sale they are not in a position or not willing to do so.

Thanks, Jon Tucker, 443.538.4316, TuckerRealty@comcast.net, http://www.JonTuckerHomes.com.
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