Getting Your Home Back After a California Property Tax Sale

If you lose your house in a California tax sale, you will almost never be able to reclaim it.

If you do not pay your property taxes on time, the amount owed becomes a lien on your house. This form of lien nearly often takes precedence over other types of liens, including mortgages. When taxes are not paid, the taxing authority will either sell the lien (and if you do not pay the past-due sum to the lien purchaser, that party may foreclose or use another way to get title to the house) or sell the property itself in a tax sale. In certain areas, however, no auction is made; instead, the taxation body enforces its lien by acquiring ownership to the residence. The taxation body is then required by state law to dispose of the property, typically by selling it. Before conducting a sale, the taxation authority in some countries utilizes a foreclosure procedure.

If you lose your house to a property tax sale in California, you won’t be able to obtain it back unless you meet certain criteria. However, you normally have five years after falling behind on your taxes to pay up the unpaid sums before the sale may take place. That’s because California law gives you the option to “redeem” the house (pay down the late amounts plus interest and charges) and avoid losing your property.

In general, residents in California have two alternatives for avoiding a tax sale: redeeming the property before the sale or setting aside (reversing) the sale after it has occurred. If you do not redeem, you will lose your opportunity to retain your California house unless you can invalidate the completed tax sale, which is uncommon.

The Right to Redeem Generally, after a tax sale,

In most jurisdictions, delinquent taxpayers have a certain length of time following a tax sale to redeem their house by paying the buyer the sum paid at the auction or paying the taxes due, plus interest, penalties, and expenses. In other areas, such as California, the redemption period begins prior to the tax sale.

A Redemption Period occurs prior to a California Tax Sale.

In California, the five-year redemption period occurs prior to the tax sale. According to state law, the tax collector cannot normally sell your house until five years have passed after the property became tax defaulted. 3691 (Cal. Rev. & Tax. Code). During this period, you may pay up the overdue sums and avoid a tax sale.

However, you do not have the right to redeem the residence after the sale. Your right to redeem expires at the end of the business day before the selling date. 3706, 3707 (Cal. Rev. & Tax. Code). If you mail or deliver the redemption amount, the tax collector must receive it before the deadline. 3707 of the California Revised Statutes and Taxation Code.

However, if your house does not sell or the buyer who purchased it at the sale backs out, your right to redeem resurfaces. 3693.1, 3707 (Cal. Rev. & Tax. Code).

How Much Money Will You Need to Redeem Your California Home?

To redeem the house, you must pay:

all past-due taxes, overdue fines and expenses, redemption penalties, and certain fees, including a redemption charge (Cal. Rev. & Tax. Code 4102, 4112).

Contesting the Sale in Order to Reclaim Your Home

You may be able to reclaim your house after the tax sale by petitioning the board of supervisors (the body that oversees the administration of the county government) to cancel (invalidate) the sale. You must demonstrate:

The sale was invalid for whatever reason, such as you paying the redemption money but the tax collector still selling the house to a new owner, or the transaction had irregularities (meaning the processes were not followed correctly).

The processes for requesting a rescission are difficult, and you must do it within a particular time frame, generally a year after the tax deed is completed. 3725 of the California Revised Statutes and Taxation Code). Getting your house back via this technique is typically difficult and uncommon. If you wish to attempt to have the transaction canceled, you’ll almost certainly require the assistance of an attorney.

How to Reduce Your Property Taxes

Even while you’ll have some time to redeem your California property before losing it to a tax sale, in most situations, it’s best to act sooner to attempt to reduce your taxes. For example, you could:

Investigate if you qualify for a property tax abatement, or contest the taxable valuation of your house if you believe it is inaccurate.