Ronald*Star and OK tax sales - Posted by Rick, OK

Posted by BR on October 14, 2001 at 08:52:41:


What counties in Oklahoma are you referring to?

Ronald*Star and OK tax sales - Posted by Rick, OK

Posted by Rick, OK on October 14, 2001 at 24:01:17:

Mr. Star:

If possible, could you run through the basics of how an Oklahoma Tax Sale works. Time frame, How do you obtain tax sale list, leins and mortgages,due deligence, etc. If you have previously answered these questions, please forgive me. I currently own investment property in two Oklahoma counties, and a primary residence in another. I have not explored the tax sale avenue, but I am very intrigued with the possibilities.

Thank you for you time,

Rick, OK

Re: Ronald*Star and OK tax sales - Posted by Ronald * Starr

Posted by Ronald * Starr on October 14, 2001 at 19:32:55:


OK is called a “certificate” state. When property taxes for last year are not paid, the county on the second monday of Oct has an auction to sell a certificate for the delinquent tax amount. If you buy the certificate, you have a lien againgst the property. You pay the taxes.

If the certificate is redeemed by the property taxes being brought current, you get back your money plus 8%/annum return. Lowest return in the USA, I think–other states are 12,16,24% and more. After about another year. or maybe two, with you paying the subsequent year taxes, you can start to get a deed. Takes about 3 months or so. You have to give notice to the property owners and any lienholders on the property. If nobody responds, you get a deed to the property. To get marketable title, you have to do a quiet title lawsuit.

If nobody buys the certificate at the Oct auction, the county treasurer puts it into a book and anybody can come along later and buy it for the original amount plus accrued interest. Up until about 2 and a half years after the orginal auction.

If nobody buys the certificate, the county starts an administrative action to sell the property for back taxes. Every county has their tax “resale” on the second monday of June, about 2 years and 8 months after the original “sale” at the auction. At the resale, you are bidding to actually get a deed to the property, not a certificate. The certificate phase is past. The bidding starts at the amount of taxes owed plus some costs of the sale–certified mail fees, sheriff’s costs, etc.

If you get the bid, the owner still has a chance to pay the taxes until the “Tax Resale Deed” is recorded in the county records. This could be the day after the resale auction or later. I got the bid on five properties this year and got the deeds on three of them, the other two redeemed immediately. One was a pretty nice property.

The resale is an all cash at the sale auction. Some counties allow you to pay with personal checks, most seem to require certified funds. At least one county, Muskogee, requires actual cash at the sale site.

Other liens, including loans, mortgages, judgments, and the like are wiped off of the property by the tax sale. IRS liens are wiped off also, although they have 120 days to redeem the property by paying you your price plus 6%/annum interest. Liens are wiped off if the county sent notices to the holders properly, otherwise they will remain on the property.
Sometimes mineral rights have been separated from the surface rights and you are only buying the surface right.

About 90-98% of properties sold are vacant land or vacant lots. About half the houses sold are very rundown. When there is a half-way decent house people will bid up on the property. So, unless you want to pay high prices, you will not get the bid on everything upon which you bid.

Sometimes the vacant land or lots can be very good deals, depending upon the market value and the bid amount. I urge you to carefully investigate each property before you bid on it. I do not try to buy vacant lots in OK at the tax resales. I am after houses to fix up and rent out.

To find out about the sales, call up the county treasurer, or read the local newspaper during the four to six week period before the resale auction date. All the properties scheduled for sale will be listed in a legal notice published 4 times, I think.

Good InvestingRon Starr****