What are tax sale overages?
Our surplus funds recovery attorneys have helped property owners recover millions of dollars in tax sale overages.
But most of those homeowners didn't even know what overages were or that they were even owed any surplus funds at all.
How It Works
When a homeowner is unable to pay property taxes on their home, they may lose their home in what is known as a tax sale auction or a sheriff's sale.
A tax sale auction is typically held by the county, which has the power to advertise the home for sale and sell the tax lien to collect unpaid property taxes.
At a tax sale auction, properties are sold to the highest bidder, however, in some cases, a property may sell for more than what was owed to the county, which results in what are known as surplus funds or tax sale overages.
Tax Sale Overages
Tax sale overages are the extra money left over when a foreclosed property is sold at a tax sale auction for more than the amount of back taxes owed on the property.
Unlike mortgage auctions, the opening bid at a tax auction is usually the amount of unpaid taxes due on the property, (plus penalties, interest, and any associated costs for putting on the auction).
If the property sells for more than the opening bid, then overages will be generated.
However, what most homeowners do not know is that many states do not allow counties to keep this extra money for themselves.
Some state statutes dictate that excess funds can only be claimed by a few parties - including the person who owed taxes on the property at the time of the sale.
Let me give you an example.
If the previous property owner owes $1,000.00 in back taxes, and the property sells for $100,000.00 at auction, then the law states that the previous property owner is owed the difference of $99,000.00.
The county does not get to keep unclaimed tax overages unless the funds are still not claimed after 5 years.
Counties will typically publish information regarding these overages in an excess funds list and are required by law to make an effort to notify the previous owner of the funds.
However, the notice will usually be mailed to the address of the property that was sold, but since the previous property owner no longer lives at that address, they often do not receive this notice unless their mail was being forwarded.
If you are in this situation, don’t let the government keep money that you are entitled to.
If your home was foreclosed on for unpaid taxes and later sold at a tax sale auction for higher than what you owed, our excess funds recovery lawyers will help you recover the money that is rightfully yours.
Call E. Albert Law at 678-664-4878 for your free consultation. You can also email us at surplusfunds@ealbertlaw.com .
Attorney Esther Mesidor
E. Albert Law
