How Do Tax Deed Sales Work in Florida?

How-Do-Tax-Deed-Sales-Work-in-Florida?Property taxes fund local services like schools, roads, and public safety. When property owners fail to pay those taxes, the county can place a lien on the property and eventually force its sale. Florida uses tax deed sales, allowing counties to auction the property to recover unpaid taxes.

Tax deed sales can be attractive to investors seeking real estate opportunities. However, they are not without risk.

What Leads to a Tax Deed Sale?

The process typically begins when a property owner falls behind on property taxes. This may happen for a number of reasons, including financial hardship, divorce of the property owners, or other reasons. 

 After taxes go unpaid, the county sells a tax certificate to investors. This certificate represents the unpaid taxes, along with interest.

If the property owner does not repay the taxes within a certain period (generally two years), the certificate holder can apply for a tax deed sale. This moves the process from a lien against the property to a potential sale of the property. At that point, the county schedules a public auction.

How the Tax Deed Auction Works

Tax deed sales in Florida are conducted as public auctions, often held online depending on the county. The property is sold to the highest bidder, with proceeds used to pay off the unpaid taxes, interest, and administrative costs.

Here’s how the auction process generally works:

• The county publishes a notice of the upcoming sale
• Interested buyers register to participate in the auction
• Bidding begins at a minimum amount, usually based on the unpaid taxes and costs
• Buyers compete by increasing their bids
• The highest bidder wins the property

Once the auction ends, the winning bidder must complete payment within a specified timeframe. The county will then issue a tax deed and transfer ownership of the property to the winning bidder. 

What Happens to the Original Owner?

The original property owner has multiple opportunities to avoid losing the property before the tax deed sale takes place. 

They can stop the process by paying:

• The outstanding property taxes
• Accrued interest
• Additional fees and costs

Once the tax deed sale is completed, the original owner typically loses ownership rights to the property.

Risks Involved in Tax Deed Sales

Tax deed sales can offer opportunities to purchase property at below-market prices. However, they also carry significant risks.

Some of the most important risks include:

• Title issues – Tax deeds do not always guarantee a clear title. There may still be other liens or claims on the property.
• Property condition – Many properties are sold “as-is,” and buyers may not have the opportunity to inspect them beforehand.
• Occupancy issues – The property may still be occupied and require additional legal steps to remove occupants.

Buyers often conduct title searches and due diligence before participating in an auction. However, opportunities for diligence may be limited if the property is still occupied.

In many cases, buyers pursue a quiet title action to clear any remaining title issues. This legal process helps confirm ownership and resolve competing claims. Without a clear title, it may be difficult to sell or finance the property in the future.

Contact the Orlando Family Law Attorneys at McMichen, Cinami & Demps for Help Today

Tax deed sales can create complicated legal and financial issues for both property owners and investors. Whether you are trying to protect your property from a tax deed sale or considering purchasing real estate through one of these auctions, it is important to understand your rights and risks before moving forward.

Tax deed sales and property disputes can become especially complicated during divorce and other family law matters. The Orlando family lawyers at McMichen, Cinami & Demps can help you navigate legal matters involving property ownership, divorce-related property disputes, and other financial concerns. 

Contact us today at 407-898-2161 to learn more about your options.

McMichen, Cinami & Demps – Orlando Office
1500 E Concord St
Orlando, FL 32803