Land Purchase / Tax Lein Question or Suggestions

[Mallow]

For a little background:

I purchased a 5 acre parcel a few years ago and am planning on building on it next spring. Recently I contacted the person who owns a neighboring 5 acre parcel about selling and after many delays he finally signs the sales contract and I have it at a lawyers doing a deed search at the moment.

Current problem:

Yesterday as im reading through the local newspaper I see that this parcel is deliquent on taxes and is to be auctioned off Nov. 13th. I did call the owner and left him a message saying that he needs to deal with it before I could ever get a clear deed and that he needs to deal with it before the 13th or he is going to have some huge headaches.

Options:

I could go pay the taxes for him and hope that the deed search comes back clean and we can settle with the current sales contract. I could go to the auction and try to buy it there but he would have to pay me all my fees plus some interest or it would be mine free and clear in 18 months. I could count on him paying it before the 13th and hope that he manages to sell it to me through the normal route with the sales contract.

Any suggestions would be appreciated. Never been through this much hassle trying to buy one piece of land.

Thanks
-Mallow

[ruester]

Actually, all that needs to happen is that when you close on the property, the lawyer/title agency will cut a check for the amount of the taxes to your county treasurer out of the proceeds of the sale. It should not cost you a dime.

Talk to your lawyer about it, but that is what a lien is for: It is an interest in the property that MUST be settled before the deed is transferred. Closing is the right time to do that.

[MaryNY]

Call your lawyer. He should know how to get the tax sale called off.

Another thought -- file the original purchase offer with the county clerk's office (or wherever deeds are filed and titles are searched) that should put a big kink in anyone else taking good title to the property even if it is sold at a tax sale. See if your lawyer thinks that might be a good maneuver.

If the tax sale wasn't looming so soon, the ordinary procedure (here at least) is for the sale to take place and the delinquent taxes to be paid by the seller out of his proceeds, or the buyer can pay them and deduct them from the amount the seller will get at closing. If what you're paying isn't as much as the delinquent taxes, that will be a whole other story. Like I said, call your lawyer - that's what he's there for.

Good luck!

MaryNY

[fantasymaker]

Buy the taxes how can you lose?

[Mallow]

Well yeah if it wasn't going on the block Monday and the courthouse closed on Friday, I think I could get it all situated. I have a call into the lawyer handling it but no call back yet. If nothing else I may just end up going to the tax sale and purchase the lien there to at least keep a 3rd party from being involved.

Thanks for the suggestions.

[XLT]

not sure exactly how WV works, but here we would execute an earnest money contract, including a clause that states that delinquent taxes will be paid by either buyer or seller. If the buyer is to pay the delinquent taxes, this would of course reduce the purchase price. The tax office will usually accept a receipted earnest money contract from a title company as enough to pull the property from the sale on the 13th.

XLT

[Mallow]

I called the courthouse to talk to them about the situation. Apparently the guy did pay his taxes last week so all is good I guess. I may still go to the auction and see if i can pick up some more parcels that are going across. You end up with a 12% interest if the original land owner pays you back for your cost. If not you end up with land which seems like a good deal.

Thanks
Mallow

[fantasymaker]

Its so much more complicated than that!