Tax Sale

I was able to go to the training seminar that was done at the City Hall Building. We were told it was being filmed and is now showing on channel 60. If you have any interest in buying a tax sale property now or in the future, here is a chance to learn at the time and before the sale. I will be at the sale also. Go with me.

In today's paper there was an article from Larry Riley on his view of the tax sale and the seminar.

Larry Riley: Navigating tax sales takes time, expertise

 A of couple times over the last few weeks a special 10-page supplement has been included in The Star Press, most recently last Wednesday: the 2013 Delaware County tax sale notice, featuring 1,930 properties.

Owners of these properties are behind in their property taxes by at least three payments (taxes are due twice a year, May and November) and at that point are subject to getting auctioned off in the tax sale.
Owners can pay up and remove the property from the sale anytime up to, I think, the day before the Oct. 1 sale, and people pour into the county Treasurer’s office doing so continually.

Owners can pay up and remove the property from the sale anytime up to, I think, the day before the Oct. 1 sale, and people pour into the county Treasurer’s office doing so continually.

By late last week, the number of properties still scheduled for the block were down to 1,689.
(Owners have to pay both back taxes and a late penalty of 10 percent, though some people who scam the system know they need only pay the oldest of the three payments in arrears. They still owe a bundle, but their property gets pulled from sale.)
I’m sure state law specifies the format of the legal publication — the aforementioned 10-page insert — but the notice is almost worthless to anyone interested in what’s for sale.
Each property starts with its obscure parcel identification, a series of 9 digits followed by another series of 18 digits, then the amount of arrearage, owners’ names, and then property address.
A reader would have to know how the parcel ID system arranges addresses in the county, find that general area in the 10 pages, and then plod through listing after listing if they wanted to see whether a particular property was in the sale.
Regardless, I’m happy the county shells out some of the fewer and fewer dollars it has to pay for the insert.
Yet you do have to research much more if you’re interested in actually bidding on properties, and a lot of businesses, both locally and nationwide, do so. Buying tax sale properties has become a cottage industry, and more, these days.
In part, this is because a buyer is not really purchasing the property, but buys a certificate giving them the right to take title after a one-year period of time in which the original owner can redeem the property by paying the original taxes and penalties.
 Along with the redemption, however, comes an additional 10 percent interest fee for the first few months that lapse followed by a 15 percent fee for remaining months, on the amount the successful buyer bid.
For example, one of the best properties still scheduled in the Oct. 1 sale from the standpoint of value minus tax owed is the Temple Baptist Church, on South Madison at 29th Street.
The church owes $2,276, an amount that rises to $2,888 on auction day, and this will be the minimum bid to buy the property. The land and 14,000-square-foot building are assessed at $466,000.
One has to believe the congregation will quickly redeem the property were it sold at auction, and thus if the winning bid were, say, $50,000, whoever bought the property would be owed $5,000 immediately. Nice ROI.
This is also an example of a property highly likely to be removed from the sale in the next few weeks. If you’re wondering why a religious property would be owing taxes, the answer is that stormwater fees, which everybody pays, are collected on tax bills and make properties subject to sale if unpaid.
The Tyler administration is trying to expand the fraternity of local people who bid in the tax sale to include prospective homeowners: people willing to invest, take the property, fix the place up and move in.
Scores of distressed properties are included in every tax sale, perhaps even the majority of one-family houses for sale.
If one knows what they’re doing, though, you can get a good deal and wind up owning valuable property for much less than what you’d pay going through the normal process of home buying.
Last week, Muncie’s Community Development office offered a 90-minute workshop attended by about 50 people on the rudiments of bidding on property and taking certificates to deed.
One piece of misinformation got passed on by the SRI Inc. representative who made the presentation (SRI is a private business that handles the county’s tax sales), namely that purchasers of tax sale property have no right to trespass on the property during the one-year redemption period.
 State law changed in 2011. While no one can enter a building, law now does allow a non-owner of a property that’s vacant or abandoned to “secure” the property, mow the grounds, remove trash and debris, and remove graffiti, and they’re immune from prosecution or civil lawsuit.
Perhaps this can be clarified before the auction.
The process remains daunting. Of the 1,689 parcels still scheduled for sale late last week, 235 are under water vis-à-vis taxes. That is, those properties owe more taxes than the property is assessed.
In some cases, as the back taxes mounted up, the house on the property became so dilapidated the city tore the place down.
For example, the Indianapolis owner of 306 E. Gilbert St., a neighborhood near downtown, owes $39,000 on a lot worth $5,400.
In other cases, modest-sized houses have accrued arrearages beyond their worth: a four-bedroom house at 2400 S. Walnut St., assessed at $17,300 owes $20,000 in taxes.
Bargains can await, but caveat emptor.
Larry Riley teaches English at Ball State University. Email him at at lriley@bsu.edu.