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Twelve Things to Know About Tax Certificates
This answer has been viewed 3855 times and was last updated on 03/21/2019.
Print this page- Tax certificates are a first lien on the real estate and bear interest at the maximum rate allowed by law (18%) unless the bidder's bid rate was lower. However, when a tax certificate is redeemed and the interest earned on the tax certificate is less than five percent of the face amount of the certificate, then the mandatory charge of five percent is levied upon the tax sale certificate. The person redeeming the tax sale certificate pays the interest bid rate or the mandatory charge, whichever is greater. This applies to all tax sale certificates except those with an interest bid rate of zero amount.
- Any tax sale certificate can be canceled if errors or omissions are made. An error that results in a change of the face amount of the certificate must be approved by the Department of Revenue and will be paid to the bidder at the bid rate or eight percent rate, whichever is lower.
- All tax sale certificates issued (except those applicable to certain homestead properties) are transferable by endorsement at any time before they are redeemed or a tax deed is executed thereunder. The official endorsement of a tax sale certificate by the tax collector or certificate holder shall be sufficient evidence of the assignment of it.
- If there are no bidders for the delinquent taxes, each applicable tax certificate is issued in the name of Manatee County. In addition, (1) a tax certificate representing less than $250 in delinquent taxes on property that has been granted homestead exemption can only be sold to Manatee County at the maximum rate of interest allowed by law (18%), and (2) when the delinquent taxes are on subsurface rights, the fee owner to which these subsurface rights are attached has the right to purchase the tax certificate at the maximum rate of interest provided by law (18%) before bids are accepted for the sale of such certificates.
- The tax collector must advertise the delinquent taxes in a newspaper which is publicized at least once a week and be of general circulation in the county. The advertisement must be once a week for three consecutive weeks prior to the tax certificate sale, and specify the place, date, and time of such sale. This sale date must be on or before June 1, unless it is impossible to hold the sale at that date due to a late tax roll. Then the sale must be held as soon as possible after the delinquency date.
- Purchase of a tax certificate in no way permits the certificate holder to enter the property or intimidate the landowner.
- Tax certificates are dated as of the first day of the tax certificate sale and have a life of seven years computed from that date. When a certificate becomes seven years old, it is deemed and held to be barred by the Statute of Limitations, and no action on the certificate may be maintained by any private holder in any court of the state. The holder of any tax certificate, other than the county, at any time after two years have elapsed since April 1 of the year of issuance of the tax certificate and before the expiration of the seven years from the date of issue, may submit a Tax Deed Application to the tax collector of the county where the real estate described in the tax certificate is located.
- Any certificate holder, other than the county, making application for a tax deed shall pay the tax collector a search fee, tax deed application fee, and all amounts required for redemption or purchase of all outstanding tax certificates, interest, omitted taxes, and current/delinquent taxes relating to the real estate. The opening bid on property assessed on the latest tax roll as homestead property must include all clerk of court fees and in addition to the amount of money paid to the collector by the certificate holder at the time of the application, the amount required to redeem the applicant's tax certificate and an amount equal to one-half of the assessed value of the homestead property as listed on the current year's tax roll. The tax deed is issued to the highest bidder therefore. A property owner or his agent shall have the right to redeem the property prior to the issuance of a tax deed by the clerk of the circuit court by making payment to the tax collector for all outstanding certificates, omitted year's taxes, delinquent taxes, current taxes and interest and for all costs of sale and fees.
- Certificate buyers need to be aware that there are risks involved with buying tax certificates, and the risks are borne by the certificate holder.
- We must advise you of the ever increasing number of bankruptcy cases being filed. When the tax collector's office is notified of a bankruptcy petition being filed, we will inform the certificate holder of the bankruptcy petition, and we urge you to seek advice from your legal advisor concerning the bankruptcy procedures, proof of claims, interest rates, payment schedules, defaults, etc. Once a bankruptcy notice is received, the tax collector is barred by the automatic stay from any form of enforcement or collection proceedings.
- What about bankruptcy? The bidder will have the opportunity to opt in to view tax certificates where the property owner is a debtor in bankruptcy. In the interest of fostering the benefits of tax certificate sales related to cases before the Bankruptcy Court, the Bankruptcy Court confirms that the automatic stay of 11 U.S. C. section 362(a) does not prevent the sale of tax certificates in the ordinary course of Florida tax collectors’ business. If you are the successful bidder, you may be required to transfer the proof of claim with the bankruptcy court. A fee may be required to complete the transfer of the claim. You may wish to consult with your attorney before purchasing tax certificates where the property owner is a debtor in bankruptcy.
- The tax certificates other than those relating to homestead real estate under $250 can be purchased or redeemed by individuals at the tax collector's office or via mail or phone. Those relating to homestead real estate under $250 can be purchased from the county when the tax certificates and accrued interest thereon represent an amount of $251 or more. For each certificate purchased, the tax collector would need the following information: (a) name and address of bidder exactly as you want it to appear in the public records; (b) a W-9, including a Social Security number or Federal ID number; (c) an Authorization Agreement for ACH transactions; (d) phone number where you can be reached during business hours. Your payment must be in the form of a cashier's check, certified funds, or money order. You will need to contact our office for the amount to purchase the tax certificate.
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