Tag: tax deed

The Actual Tax Sale in Georgia

As a general rule, tax sales are held on the first Tuesday of the month. However, not every county has a tax sale every month. Generally, the tax sales are conducted between the hours of 10 am and 4 pm  on the steps of the county courthouse. If the first Tuesday of the month falls on a legal holiday, the sale is held the next day, Wednesday.

The opening bid for a particular property is the amount of tax due, plus penalties, interest, fi. fa. cost, levy cost, administrative levy fee, certified mail cost, advertising cost, and tax deed recording fees. The property is sold to the highest bidder.

Immediately following the conclusion of the tax sale all purchasers must pay in full the amount bid at the auction. Payment must be in the form of cash, certified check, or cashier’s check. Normally, the purchaser to sign a statement attesting to the fact that certain property was purchased for a certain price. After all payments are processed, the count will provide a Tax Deed and the Real Estate Transfer Tax form.

According to O.C.G.A. § 9-13-170, any person who becomes the purchaser of any real or personal property at any sale made at public outcry who fails or refuses to comply with the terms of the sale when requested to do so, shall be liable for the amount of the purchase money. It shall be the county’s option either to proceed against the purchaser for the full amount of the purchase money or to resell the real or personal property and then proceed against the first purchaser for any deficiency arising from the sale.

Investa Services of GA, LLC Tax Execution Case

Anyone who deals with unpaid taxes in Georgia knows that Investa and/or entities affiliated with Investa play a significant role. A class action was filed against, among others, Investa. In this lawsuit, Investa et al. was accused of improperly levying on tax executions for delinquent property taxes based on initial tax assessments later reduced via a property tax appeal.

The trial court dismissed the lawsuit and an appeal was filed. See B.C. Grand, LLC v. Investa Services of GA, LLC, A19A1297 (GA Ct of App, October 29, 2019). On appeal, the court ruled in favor of Investa et al., finding that  B.C. Grand “failed to allege that the [Tax] Commissioner cancelled the tax executions or that they are void as a matter of law based on the post-issuance reduction in the tax assessment.” Because B.C. Grand failed to pay the taxes at issue while pursuing its appeal of the assessment and instead waited to receive a refund (which it did receive), the full amounts owed remained valid. And because B.C. Grand failed to plead the executions were void as a matter of law or were cancelled, Investa et al. were authorized to levy the executions at the full purchase price amount. Chalk one up for Investa.

Tax Deed Services For Owners of Tax Deeds

If you own a tax deed, we offer two services related to tax deeds: (1) barring the right of redemption and (2) quiet title.

(1) Barring right to redeem/Notice of Foreclosure of Right to Redeem. In Georgia, you are entitled to bar/foreclose the right to redeem any time after one year has passed from the tax sale. Barment notices need to be sent to the owner of the property at the time of the tax sale and to any other party that holds an interest in the property.  

We are normally willing to charge a fixed fee (depending on the circumstances of the tax deed) plus expenses. Expenses include title search (about $300), publication (about $150), sheriff’s service ($50/service), and certified mail ($6.80/envelope).

The average cost to foreclose/bar the right to redeem, including expenses, is approximately $1,500.

(2) Quiet Title Against All the World. This is done after the barment is complete in order to obtain marketable title. A quiet title involves filing a lawsuit in the Superior Court of the county where the property is located. On these, we charge attorney’s fees on an hourly basis. Normally, the attorney’s fees are about $2,500, but like any lawsuit, we can’t quote an exact amount because the time required varies from case to case. In a quiet title, the court will appoint a special master: a special master is a local attorney who reviews the case and gives a recommendation to the court regarding title. The special master will cost an additional 2,500 (this amount is approximate). Court costs are an additional $500 (filing fee is approximately $250 and service on each defendant is $50).

The total cost of a quiet title is about $5,000.

Another Georgia Excess Tax Sale Funds Case

Republic Title Co. v. Freeport Title & Guar., Inc., A19A0274 (May. 29, 2019) concerns entitlement to excess funds remaining following a tax sale pursuant to OCGA § 48-3-3. We’ve discussed this in previous blogs. There isn’t much new here but the case does reinforce some tax deed principles of interest. In this case, the property owner at the time of the tax sale sought to collect excess tax sale proceeds following the tax sale. Also following the tax sale, a security deed holder on the property similarly sought the excess tax funds.

The owner filed a lawsuit seeking the excess tax funds, and, in the same lawsuit, sought to quiet the security deed holder’s lien as a cloud on title. The argument was the loan had matured for more than seven years and therefore wasn’t enforceable at the time of the tax sale. In Georgia, under O.C.G.A. § 44-14-80, title to real property conveyed to secure a debt or debts revert to the grantor the expiration of seven years from the maturity of the debt or debts or the maturity of the last installment thereof as stated or fixed in the record of the conveyance (this is the general rule).

Following the recommendation issued by a special master appointed in the case, the trial court ruled in favor of the owner; awarding the owner the excess tax funds and quieting title against the security deed holder. The Georgia Court of Appeals agreed. The Georgia Court of Appeals rejected the security deed holder’s argument that the special master didn’t have authority to issue a ruling on excess funds. And the security deed holder’s argument that the property owner lacked standing to bring a quiet title was likewise disregarded. Although the quiet title was filed by the owner after the tax sale, it was filed within the time period in which the owner had a right to redeem the property. Thus, the owner’s right to redeem was enough to give the owner standing to quiet title against the security deed holder.

If you have any questions regarding tax deeds, please call us at 404-382-9994.

Georgia tax deeds: What if the delinquent taxpayer is deceased?

When a property owner dies, often taxes go unpaid, and the property gets transferred at a tax sale. This typically happens when a property owner dies without close family or when the decedent’s family thinks it’s too much hassle taking over the property (maybe the property is in bad shape or there is little equity).

As every good tax deed purchaser knows, 366 days after the tax sale, notices to terminate the right to redeem can be sent out. But who do you send these to when the main person entitled to redeem, the homeowner, is dead.

O.C.G.A § 48-4-45 answers this question and instructs that “heirs of any deceased owner of any land entitled to notice pursuant to this Code section shall be served by the sheriff or notified as provided in this article.” Ok. So if the former owner is deceased, you are required to serve his or her heirs. Seems simple enough, but how do you determine who the heirs are?

In our office, we start by getting the death certificate of the deceased individual. This tells us where the decencent was living and (normally) provides information regarding at least one family member. We then contact family members to determine the heirs. As you can imagine, family members aren’t thrilled to talk to an attorney’s office who’s trying to “take property away from” a loved one recently passed. However, after explaining the situation, we usually get the family members to help us.

We also check the probate courts to see if the dead person has an estate and had a will. If so, we get the probate paperwork. If the person died intestate (without a will), then we follow Georgia statutory intestate rules to determine the heirs, and try to get “affidavits of descent” from family members. These affidavits help establish who the decedent was married to, the identity of the children, and so forth.

This can be a lot of work. In one case, we had an elderly decedent who died without a will, wasn’t married, and had had nine children. Several of those children had passed, meaning several of the grandchildren were heirs. We ended up having to locate and serve approximately 19 heirs spread all over the country.

If you need to send out notices of foreclosure of right to redeem in Georgia, and are facing a similar situation, we’ll be happy to discuss your situation and answer any questions. Please call us at 404-382-9994.