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What is a Homeowner’s Liability for Unpaid Real Estate Taxes After Foreclosure?

When you lose your home in foreclosure, the bank takes over the property, but you might be wondering who becomes responsible for property taxes. Many homeowners who go through a foreclosure worry that they are required to continue paying taxes. Those overdue real estate taxes are a problem, but most attorneys agree that the homeowner is not responsible for them. Those taxes are associated with the property itself, not the people who are living in the property. Therefore, if you are no longer tied to the property because of a foreclosure, the unpaid or overdue property taxes are not your problem. Consult an attorney with expertise in foreclosures or real estate law just to double check. However, you should not worry about paying taxes on property you no longer own. Taxes on any personal property will be your responsibility. However, the tax liability on your property will transfer to the new property owner. So, if someone buys your house at a foreclosure auction, that new buyer will have to assume the tax burden. If your lender is going to hold onto your property for a while, the lender will have to take over the tax payments. As soon as you realize you are going to allow your home to go into foreclosure, you should stop paying your property taxes. If you are planning to strategically default, do not pay any new property taxes. Be careful if you are trying to negotiate a short sale or a deed in lieu of foreclosure. In those cases, your lender might require that your property taxes are paid up and current in order to agree to any kind of deal. Stephen K. Hachey, a Florida real estate attorney, can help you navigate this process. Contact our offices at 866-200-4646. This article is for general informational purposes only and does not establish an attorney-client relationship. Please contact a licensed attorney in your state of residence. For more information on our services, please visit our website at floridarealestatelawyer.org.

This post was written by Stephen Hachey. Follow Stephen on Google, Facebook, Twitter & Linkedin.