DELINQUENT PROPERTY TAX LIEN SALE OVERVIEW

Charles “Hos” Hoskins

Retired Maricopa County Treasurer

The next delinquent property tax lien auction for Maricopa County will be on February 5, 2019 for the 2017 tax year. A list of the liens will be published in mid-January. Bidding is online only and will begin when the list is published and close on February 5, 2019.

The auction bid site will be available in mid-January and information on the auction is located on the Maricopa County Treasurer’s web site at: https://treasurer.maricopa.gov/   Select “Liens and Research” in the “Resources” column to view the menu for other informational links. Information can also be found in the Arizona Revised Statutes beginning at section 42-18101 in Title 42, Chapter 18, Article 3, at: https://www.azleg.gov/arstitle/

A map of current delinquent parcels can be viewed on the Treasurer’s site by selecting “Parcels with Overdue Taxes” in the resources column. This will provide a map showing all delinquent parcels. Place the cursor over the desired review area and scroll in. This is an excellent tool to help avoid listing or selling a property that may have delinquent taxes.

The auction is open to any eligible bidder. Anyone can become eligible by registering online at the Treasurer’s site by completing the applicable IRS form, establishing a budget, and making an online ACH deposit.

A budget amount is how much an investor is willing to risk. The ACH deposit is a minimum of $500 or 10% of the investor’s budget, whichever is greater. An investor can bid more than the budgeted amount, but he or she will not receive additional liens after that amount is reached. Consider a set budget of $5000 and a total bids amount to $8000. The successful bidder would only receive the first $5000 worth. A budget and ACH deposit amounts can be increased at any time.

Bidding is in whole percentages from zero to a maximum of 16 percent. The bid percentage is the return that investors are willing to accept on their money. If more than one investor bids the same percentage, the winner is decided by a random number generator using the bidder’s numbers. The process is both an auction and a lottery. Unpurchased liens are available for sale at the Treasurer’s Office after the auction.

A subsequent year’s tax (sub-tax) can be added between June 1 and December 31. Subsequent year liens not sub-taxed will go to the next tax lien auction. The interest earned on a sub-tax is the same as that of the original purchased lien.

Bidders are effectively offering to pay all of the taxes, interest, and fees in exchange for a lien on the property that can be foreclosed. Unredeemed liens can be foreclosed three years from the date the parcel was first offered at sale by applying for a court ordered deed (judicial foreclosure).

The foregoing overview is but a fraction of what is presented on the Treasurer’s site and in the statutes. Anyone considering investing in tax liens should thoroughly study those resources before investing.

Charles “Hos” Hoskins is the former Maricopa County Treasurer and former Director of the Arizona Department of Revenue.