Resolving Back Property Taxes on Foreclosed Property

The title commitment papers on a property will reveal any unresolved issues connected with the property, including back property taxes. When you are considering purchasing a property that has been foreclosed, make sure you have the property's title commitment papers in hand before the closing. Review them thoroughly, because the best time to resolve back property taxes on foreclosed property is before the closing. You will then receive title insurance papers reflecting that any back property taxes have been paid, and that all outstanding issues connected with the property have been resolved.

Resolving Issues with No Title Commitment Papers

If you did not receive the title commitment papers prior to the closing, and a back property tax issue surfaces in the title insurance documents after the closing, make sure this isn't an oversight by the title company. The seller may have paid the taxes but the title company failed to follow through. In that case, the title company must pay the taxes. Likewise, if neither the title commitment nor the title insurance documents reveal unpaid back property taxes on your property, but taxes are owed, the title company is obligated to pay them.

If, however, you have closed on the property before obtaining title commitment papers, and both the title commitment and title insurance papers show that there are unpaid back property taxes attached to your property, you will be liable to pay them. You may be able to register a claim with the title company to get the taxes paid. If the title company is not cooperative, you may have to file a legal claim against them.

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