Tax Liens

Tax Liens refer to a lien that is imposed by law on property in order to secure that people pay their taxes. Tax Liens are imposed for taxes that have not been paid and are owed on personal property or are owed when the person fails to pay other taxes such as income tax.

Tax Liens which are on real estate are concomitant with the land which means that the owner of the property has the responsibility for the payment of taxes even if the obligation of the tax was incurred by the previous owner. Tax Liens depend on the state law and many times the property owner may also be responsible personally for the tax payment. There are various methods of the payment of Tax Liens such as if the property owner sells the property before the foreclosure of tax by the income tax body of the government, Tax Liens are paid as closing costs.

Another method of the payment of Tax Liens is that the property owner may directly make the payment or in some cases the payment of the Tax Liens is made by the holder of mortgage indirectly by using an account escrow. The notice is sent both to the mortgage holder and the owner of property when the tax on the property is delinquent. As a result of which, even if the owner of property does not have on the mortgage an escrow based account, the company that has given the mortgage receives the notice and then pays the tax that is due. Then the mortgage company demands from the owner repayment or it might also set up an escrow account in order to recoup the payment that has been made.

The methods of the payment of Liens Tax vary from one state to another. Another method of the payment of Tax Liens is that when on personal property the Tax Lien has not been paid within the time period that has been specified, the property is seized and it is sold at a foreclosure sale. There are various methods of Tax Liens sale such as rotational selection, premium, bid the interest down, bid the ownership down, and random selection. These methods of Liens Tax sale are used in case many investors are interested in the same Tax Lien.