What You Need To Know About Past Due Property Taxes In Knoxville
This is Keith Graham with East Tennessee Home Buyers, where we buy houses in Knoxville. Today, we’re going to discuss selling your property even if you are behind on property taxes. This is a more common issue than you might think. If the tax is not factored into the escrow on the mortgage, then the responsibility for ensuring the property taxes get paid falls on the homeowner. Even with the most meticulous record-keeping and best intentions, sometimes people simply forget about paying their property taxes. Property tax delinquency can easily get out of hand if you don’t stay on top of it.
City and county taxes in Knoxville are due every October with a grace period lasting until February. Typically, if a homeowner fails to pay for even just two years, they will be notified by a local agency. As the account becomes more delinquent, the notices become more aggressive. It’s obviously important to keep the property tax account up to date. If the account becomes extremely far behind, the city or the county of Knoxville will likely initiate a sale of the property at auction. The purpose of the auction is to recoup the outstanding property tax debt to the city or county. It is not intended to make a profit for the homeowner. Needless to say, this is not a pleasant experience. Once the process has started, it becomes increasingly complicated and it’s exceedingly difficult to stop. It’s easy for a homeowner to become overwhelmed.
Ways To Avoid The Tax Sale If You’re Behind On Property Taxes
At East TN Home Buyers, we know how to handle situations involving missed property tax payments. One of our more challenging and interesting transactions involved a widow. This homeowner had apparently not paid her taxes for an incredible 16 years. That may be a Knoxville record! Knox County had somehow let this one slip through the cracks for an astonishing decade and a half. At this point, they were absolutely intent on auctioning the property. The homeowner called us in a panic to ask for our help. She knew that we buy houses in Knoxville under all sorts of circumstances.
After speaking with her on the phone, we visited the property, and performed an assessment. We had to ask how she could possibly come to be 16 years behind on the property taxes. We found out that, sadly, her deceased husband managed all the couple’s finances, including the property tax payment. Unfortunately, when he passed away in 2001, she did not realize she needed to pay the taxes. It is unclear how the local authorities missed this wildly delinquent account.
After thoroughly inspecting the property and speaking with some members of the extended family, East Tennessee Cash Home Buyers decided to purchase the house. The sale price would include reconciling the past due property taxes, which totaled almost $17,000. By bringing that tax account current and buying the house, we able save the property from going to auction. All’s well that ends well – or so we thought.
As is standard in these situations, we needed to fill out what is known as an “Heirship Affidavit.” This is typically done when someone passes away but does not leave a last will and testament. In our conversations with the seller, we were told she was the sole heir to the property. Despite this, we still had to get some heirship affidavits completed by people that knew her deceased husband. This is usually a simple, straightforward process.
If Selling To Pay Your Tax Debt Is Your Only Option, Transparency Is The Key!
Well, we soon discovered that she was, let’s say, a little less than forthcoming about her family’s situation. She apparently failed to tell us that her deceased husband did, in fact, have a son from a prior marriage. And because all this transpired after we had already purchased the property, this situation had the potential to become an extremely complicated problem. Fortunately, we have experience with all kinds of transactions. Sometimes the process moves along smoothly. Sometimes, we must overcome a few obstacles. No matter the challenge, our professionals know how to handle any situation.
At East Tennessee Home Buyers, whenever we buy houses in Knoxville, we always get title insurance. This was the first time ever we had to file a title insurance claim in order to clear up a title issue. At the end of the day, we successfully completed the purchase of the property, all the past due property tax debt was reconciled, and East Tennessee Home Buyers was able to save the property from auction.
If you receive a letter from the Knoxville property assessor threatening to auction your home, you need not fear. Call East Tennessee Home Buyers today!