Although rare, the sale of a specific tax sale property can be cancelled by the county AFTER you purchase it! Imagine the horror you’d feel if you remodel a house that you *thought* you purchased only to realize you aren’t the owner! Check out this video so that you can avoid that disaster from happening to you!
Transcript:
Hey, folks! It’s Casey Denman here with TheTaxSaleAcademy.com. In this video, we’re talking about tax deed sales that are cancelled. Now, before we get started, I want to make something very clear here. We’re not talking about tax deeds that are redeemed. That’s called Redeemable Tax Deed States and that’s something for a totally separate video and I’ve actually done videos here on YouTube about it before. So if you’re interested, find those videos.
We’re talking about when a tax sale is just completely cancelled. You go to the auction. You bid on a piece of property. You think you get a great deal. You give the clerk your money, they give you a receipt, and then you think you own the piece of property. Well, not so fast here. The clerk can cancel that sale if they need to.
Now, they only have a certain amount of time to do it, but what you need to do here is you don’t need to invest a whole lot of money, time or effort until that sale is finalized. And what I mean by finalized is until the deed is actually recorded that grants the property to you, until the property is in your name on a county record search where the deed is given to you, do not invest a whole lot of time or money.
Now, there’s different situations that something like this could happen. A lot of county offices are basically understaffed and overworked. So sometimes they’re doing 200, 300, 500 of these tax foreclosures at one time. They might make an error. They might have a spelling mistake as far as an owner’s name or a legal description, and that’s a reason that a sale could get cancelled.
They could also have a piece of property where there are two or three owners. They could have notified all but one of the owners. Again, because they did not notify the owner, which based on state statute in a lot of states they have to notify every single owner, there’s another reason a sale could get cancelled.
It could also be a situation where the owner is in a bankruptcy court. Not only do you have to notify the owner, you also have to notify the bankruptcy judge. There’s another situation that a sale could get cancelled and there’s a bunch of technicalities that tax sales can get cancelled.
Now, with that said, it is kind of rare for tax sales to be cancelled. I’ve been investing a very long time and I’ve bought lots and lots of properties, and I can literally count four or five times that tax sales have actually been cancelled on me. So it is rare, but what you need to do here is not invest a whole lot of money into a piece of property before that deed is recorded in your name.
A lot of state statutes dictate that after the actual sale, the county might have 15 days, 30 days or 45 days in which to put the deed in your name. And during those 15, 30 or 45 days, at that time they will allow other people to object. The former owner might say, “Well, listen, I didn’t know about it” or the bankruptcy judge might contact the county and say, “Listen, you didn’t notify my court system like you should have.” So there are certain time stipulations.
The good news is once it’s in your name, it’s in your name good and it’s in your name permanently. But the last thing you want to do is buy a piece of property at a tax sale auction, reroof it the next week, have the sale cancelled the following week, and then you realize, “Hey, I just reroofed somebody else’s house.” So, when it comes to tax sale investing, wait for the deed before you invest any substantial time, money or effort into a piece of property.
I hope this has helped you out. If you’d like to see similar videos about tax sale investing, head on over to my website at TaxSaleAcademy.com. And you can do that by clicking the blue link right here next to my head. And again, it will take you to TheTaxSaleAcademy.com. And while you’re there, download your free copy of my e-book, The Tax Sale Blueprint.
Have a great day! Bye-bye.