You may redeem your Indiana house after losing it to a tax sale, unless you’ve abandoned 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.
To sell your house in a tax sale in Indiana, the county auditor and treasurer must get a judgment from a court. The court will order a sale, and the treasurer will sell your house to the highest bidder in a public auction, subject to your right of redemption (see below). 6-1.1-24-2, 6-1.1-24-5 (Ind. Codes). If no one makes a minimum offer, the top bidder, or the county or municipality, receives a certificate of sale. 6-1.1-24-9 (Ind. Code). This certificate does not provide the purchaser ownership of the property. After the redemption time has expired, ownership is transferred through a tax deed.
In general, persons who lose their house due to a tax sale in Indiana have two alternatives for reclaiming it: redeeming it or setting aside (reversing) the sale. In most situations, you will then be given the option to pay down the unpaid payments, plus interest, and “redeem” the property within a certain time frame. However, if you leave the property or fail to pay, you will lose your opportunity to retain your Indiana house unless you can invalidate the completed tax sale, which is unusual.
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Generally, the right to redeem 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 certain places, the redemption period takes place prior to the sale. However, if you do not redeem, the purchaser will be able to get title to the house free and clear of any liens that existed prior to the sale.
During the redemption period, the homeowner usually has the right to dwell in the house. The length of the redemption period varies by state; one year to three years is normal. However, in certain places, the time limit is substantially shorter.
What Is the Redemption Period Following an Indiana Tax Sale?
In general, after a tax sale, the homeowner has one year to pay the redemption price and regain the property. 6-1.1-25-4 (Ind. Code).
However, in other situations, the redemption term is 120 days, such as when:
If the county acquires a lien for which the certificate of sale is not sold (120 days after lien acquisition) or is sold (120 days after certificate sale), the certificate is assigned to a political subdivision or given to an authorized urban homesteading program. 6-1.1-24-9, 6-1.1-25-4 (Ind. Code).
Obtaining a Longer Redemption Period
If the property does not sell at a tax sale and the treasurer and owner agree to pay the total amount within one year of the agreement before the expiry of the 120-day redemption period, the treasurer may extend the redemption term to one year from the agreement date.
However, if the homeowner fails to comply with the agreement, the treasurer may terminate the agreement by providing the owner 30 days written notice, and the extended redemption time will then expire 30 days after the notification date. 6-1.1-25-4 (Ind. Code).
There is no redemption right for abandoned homes.
You cannot redeem the property if it is designated unoccupied and abandoned under Indiana law and is on the county auditor’s list of such properties. 6-1.1-25-4 (Ind. Code).
Reminder Regarding the Right to Redeem
The individual who purchased your house during the sale must give you a notification regarding your entitlement to redeem the property no later than 90 days after the transaction. 6-1.1-25-4.5 (Ind.
How Much Money Will You Need to Redeem Your Indiana Home?
To redeem your property after a tax sale from a purchaser that purchased your home during the sale, you will most likely have to pay the following:
If you redeem the property within six months of the sale date, you must pay 110% of the minimum bid necessary at the auction, which includes taxes, fines, and expenses.
If you redeem the property more than six months, but not more than one year, after the sale date, you must pay 115% of the minimum bid price.
5% per year on the excess of the buying price above the minimum bid amount
all taxes and special assessments the purchaser paid 5% per year on any taxes or special assessments that the purchaser paid\s all additional taxes, special assessments, interest, penalties, and fees on the property that accrued and are delinquent after the sale\s all taxes or special assessments, or both, paid by the county treasurer, and\s costs. 6-1.1-25-2 (Ind. Code).
What Happens If You Don’t Redeem?
If the real estate is not redeemed within the redemption period, the purchaser may petition the court for a tax deed (title) to your residence. 6-1.1-24-9 (Ind. Code).
Putting a Completed Tax Sale Aside
In certain rare cases, such as if the tax lien or tax sale procedure was flawed, the taxes were paid or not owing, or there was excusable negligence, you may be able to invalidate a completed tax sale. The grounds for invalidating a tax sale, as well as the processes for doing so, are extensive. If you lose your property in a tax sale and want to learn more about putting the sale on hold, contact an experienced lawyer as soon as possible.
How to Reduce Your Property Taxes
Even though you will most likely be granted a redemption time after an Indiana tax sale, it is usually preferable to take action before your taxes become late in order to make them more inexpensive. For example, you could:
Find out whether you qualify for a property tax abatement, or seek a revision in the property’s assessment if you believe the assessed value does not represent the fair market value.