Tax Sale Foreclosures

In Maryland, when property taxes or other municipal liens on a property are not paid, each county sells the property to the highest bidder and issues a tax sale certificate. The winning bidder must pay the taxes owed or lien at the time of the sale along with a “high bid premium,” if the bid is above a certain percentage of the property’s assessed value. The high bid premium is deposited with the municipality, does not earn interest, and is credited toward the bid purchase price should the tax sale certificate holder complete a tax sale foreclosure before an interested party redeems the delinquent taxes. The premium is refunded to the bidder if the delinquent taxes are redeemed.

In general, a tax sale foreclosure cannot be filed until six months after the tax sale auction and until two months after special notices are mailed via regular and certified mail to the property owner and mortgage lenders of record.   Once the foreclosure is filed, it takes six months to a year to satisfy all of the service and notice requirements, obtain a tax sale judgment, and then obtain a deed for the property from the municipality.  At any time before judgment, any interested party may redeem the tax sale.

If service is not made on all of the Defendants, it may be impossible to get clear title to the property even if you have a Deed from the municipality. In other words, you may own the property, but you can't sell it. 

If there are any technical mistakes in the case, an interested party could come back years later and strike your judgment and your Deed.

The tenant or occupant of the property is entitled to notice, even though they do not own the property. The tenant or occupant also has a right to redeem the delinquent taxes.

Maryland law "caps" the maximum amount of attorney fees and costs that a tax sale holder can charge to the property owner upon redemption.

The municipality often makes mistakes in the tax sale process. The municipality’s mistakes could invalidate your tax sale lien even after you have filed your foreclosure. This means that you may have to absorb the court costs and attorney’s fees you’ve already spent and only get your principal and half of your interest returned.

Let the experts at the Kenny Law Group help guide you through this complicated and risky process. Contact us at (410) 415-7071!