Foreclosing on an Indiana Commissioners Tax Certificate

Last week I talked about buying a tax certificate in Indiana at a Commissioners Certificate Sale. These are unsold properties from the annual tax lien sale that were certified to the Board of Commissioners and have only a 120-day redemption period (vs. 1 year for those sold at the annual sale).  As promised, this week I’ll talk about the process for foreclosing on certificates that are not redeemed. 

Not less than 30 prior to the expiration of the redemption period (which is 120 days from the date of sale), the purchaser must send a Notice of Sale to the legal owner and any persons with a substantial interest of public record in the property that a lien has been sold on their property. The buyer must initiate a title search on the property to identify the owner and other interested parties.

The Notice must include all the information required by state law (see Indiana Code 6-1.1-25-4.5). The notice must be by certified mail and other reasonable efforts to notify the owner. If the property is redeemed, the owner will be required to reimburse the buyer for his/her actual paid title search expenses, not exceeding the amount established by the county, if the buyer files a form 137B with the Auditor prior to the redemption date. If the buyer fails to provide notice or provides insufficient notice as required by IC 6-1.1-25-4.5, the Court may impose a penalty equal to 100% of the purchase price.

The buyer must present a verified petition to the court that issued the original judgment for delinquent taxes and penalties on the property asking the Court to order the County Auditor to issue a Tax Deed if the property is not redeemed from the sale by the redemption period expiration date. If the buyer fails to fulfill the requirements for issuance of a court order directing the Auditor to issue a tax deed, the Court may impose a penalty equal to 25% of the purchase price and refuse to accept the purchaser’s petition for a deed under IC 6-1.1-25-4.6.

The next steps in the foreclosure process are as follows:

1. Present the court with proof that the time for redemption has expired. Also provide copies of all notices given to the owner and any person with a substantial interest in the property, including supporting documents (postal certified mail receipts, etc.).
   
2. Present the Court with evidence of payment of all taxes, assessments, penalties and costs, both at sale and subsequent thereto, and other evidence of compliance with statutory requirements as the court may require.
   
3. Present the Court with a copy of the Tax Sale Certificate.
   
4. Receive a Court Order directing the County Auditor to prepare the tax deed.
   
5. Present the Court Order and Tax Sale Certificate to the County Auditor and receive the tax deed for the property within 30 days.

You can go through the process yourself, or retain the services of an attorney familiar with the state requirements. If you are doing it yourself, be sure to check the relevant portions of the Indiana Code for specific details on this process.

Happy investing!

Michael Williams
816-673-1874


Rogue Real Estate Investor Collection