What Do You Think....
I just attended a "Deed" Tax Sale or as the state of PA call's it an "UpSet Sale". I purchased a home from the state, and filed the paper work to get the Deed. I have also called the current lending institute to get a payoff balance and assume the current loan (Very Little). The lending institute is in the process of mailing an assumption package. I then received a phone call from a lawyer who represents the current owner Apparently the owner forgot to pay for the total amount of taxes, which is why the property got sold at the Upset Sale on Sept 10, 2003. The lawyer had offered me to pay the total amount I invested to purchase the property plus 500 dollars. I stated that I would accept the offer if the total amount could be delivered within a period of time (7 days). After the lawyer talked to his client, he called me back and stated that his client was not willing to pay the additional 500.00 dollars. I stated to the lawyer that if his client was willing to pay the full amount without the additional 500.00 dollars within 7 days, that I accept.
Now it starts getting very complicated. The lawyer then contacted me and told me that the county had not spent the tax portion of my entire invested amount and that they were willing to pay only the purchased amount (Bid Amount) of the total vested amount and that the Tax portion (1% State and 1% Municipal) would be refunded by the county. I then stated to the lawyer that I would like the total amount to be refunded by one party (His Client), not the county. If they were unable or unwilling to agree to this terms that I was in the process of assuming the mortgage. A couple of days went by, and I received another call from the lawyer, stating that I needed to decide by 9:00PM, to his offer or his client would file for Chapter 13, which will hold the Deed process, and he would then file a lawsuit against the county and me. Which is where I stand today, I have aquired the services of a lawyer to help me in this matter, but would like any comments or any helpful info that could help me and others in this situation. Thank you for any information and comments posted to this subject.
Normally the Tax Sale process includes a specified period off time that the owner can redeem the property. This is done by paying the County the Back Taxes, and any associated penalties and interest. Then the county pays you your amount, with interest, penaltyies etc. That's the way it goes, Period! The thing about this is that every area does it in their own way, and there are little nuances specific to your area.
My understanding is that if you have a tax deed, that the mortgage may become wiped out, and you may not have to assume it. It would be worth checking it out. (The tax lien is a senior lien to the mortgage.)
With regards to the property owner filing bankruptcy, it could slow the process up, but the bankruptcy will not make the taxes go away. he will still owe any taxes that he owed prior to the bankruptcy. I'd follow the advice of your attorney, and do any research into the process where you live further. it may not go the way you thought it would, but you're in a pretty strong position. You have done nothing wrong, and I think that the attorney is just trying strong arm you into making a decision in his client's favor.
First off, If his client is able to get the courts to declare him bankrupt, he doesn't have alot of money to begin with.
Secondly, the attorney doesn't work for free, any lawsuit he would file against you would have to be paid for. Not by you. I'd bet he's bluffing.
Good Luck,
Jeff
[ Edited by jeff12002 on Date 10/10/2003 ]
I agree, too. Sounds like baloney. What does the guy have to gain? A few more months in the house? If the county followed their laws up to the sale, He still doesn't get the house unless he repays everything plus interest. What does your attorney say? What does the county say?
JRA[ Edited by augustrose on Date 10/12/2003 ]