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Options to Avoid Property Tax Foreclosure

Authored By: Northwest Justice Project LSC Funded

If you have received notice in the mail, posted on your door, or delivered to you that says your home or your property is “subject to foreclosure,” “in foreclosure,” or will be “sold at auction” because of unpaid taxes, you may be able to stop or delay the foreclosure and sale of your home. #6235EN

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Can I prevent a Property Tax Foreclosure?

If you have received notice in the mail, posted on your door, or delivered to you saying your home or your property is "subject to foreclosure," "in foreclosure," or will be "sold at auction" because of unpaid taxes, you may be able to stop or delay the foreclosure and sale of your home.

Why did I get this notice? What is a property tax foreclosure?

The County charges property taxes yearly. Every year, the county collects state and local taxes based on the value of your home.

The County starts a foreclosure if any property taxes are unpaid for three years. The county can sell your home to collect all unpaid property taxes.  If you have not paid property taxes for three years or longer, the county will start the process of "foreclosure."  

*Example: It is 2014. You owe property taxes from 2011, but are current for 2012, 2013 and 2014. The county can start foreclosure to sell your home to pay the 2011 property taxes.

The County provides notice of court hearingBefore the county sells your home, it must give you at least 30 days' notice of a court hearing about the foreclosure. The notice must tell you the hearing place, date, and time.
At the hearing, you will have a chance to tell the judge why the county should not foreclose your home. The county will sell your home at auction unless you take steps to stop the foreclosure.

*For help, contact the Northwest Justice Project at http://nwjustice.org/get-legal-help or 1-888-201-1014.

What can I do to stop the property tax foreclosure?

Apply for a Property Tax Exemption.[1]You may be eligible to have your property taxes lowered if you have a low or limited income AND, at the time the property taxes were charged:

  • You were at least 61 years old during the calendar year OR

  • You were a surviving spouse of someone getting an exemption and you were 57 in the year of your spouse's death;[2]
  • You were unable to work due to a disability OR

  • You were a Veteran with a disability resulting from military service OR you were the spouse of a Veteran who died or was disabled due to military service.

*Our publication called Property Tax Exemptions for Senior Citizens and Disabled People has more information.

Apply for a Property Tax Deferral.[3]You may be eligible to defer payment of some past due property taxes if you have limited or moderate income and equity in your home.

  • You likely have equity if you own your home outright OR your home's value is more than what you still owe on the mortgage.

  • If you receive a property tax deferral, the county will let you pay some of your property taxes later.

*Our publication called Property Tax Exemptions for Senior Citizens and Disabled People has more information.

Apply for a Rescue Loan. You may be eligible for a "Rescue Loan" if you are willing and able to participate in housing counseling.

  • A "Rescue Loan" is a 0-2% interest, thirty-year loan to help you keep your home.

  • You can use a Rescue Loan to pay off the past due property taxes and stop the foreclosure of your home.[4]

  • You can get more information about Rescue Loans through HomeSight at: at: www.homesightwa.org/foreclosure-rescue-loans.

File for Bankruptcy. You may be able to stop or delay the foreclosure by filing for bankruptcy. Filing for bankruptcy may allow you to pay all past due taxes over a three- to five-year period.

*Talk to a bankruptcy lawyer about whether this is a good option for you.

More information about bankruptcy is available through Northwest Consumer Law Center at: http://www.nwclc.org/index.html

 

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This publication provides general information concerning your rights and responsibilities. It is not intended as a substitute for specific legal advice.
This information is current as of September 2016.

© 2016 Northwest Justice Project — 1-888-201-1014
(Permission for copying and distribution granted to the Alliance for Equal Justice and to individuals for non-commercial purposes only.)

 

Footnotes:

Last Review and Update: Sep 09, 2016
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