MEMPHIS, TN (WMC-TV) - A tax foreclosure is one person's failure and another person's opportunity.
Unlike regular foreclosures in which a bank has foreclosed for non-payment of the mortgage, a tax foreclosure is where a city or county forecloses on a property for non-payment of taxes. Debra Gates of the Shelby County Trustee's office says Shelby County sells between four and six tax foreclosures a year.
To find out if the county trustee has any tax foreclosures for sale and when, click here:
The trustee will sell tax foreclosures at auction to the highest bidder. According to Gates, you must be registered as a bidder by 10am the day of the sale.
"Bidders are strongly advised to research the properties on which they are interested in bidding," said Gates. "This includes, but is not limited to, previewing the properties and looking up the legal descriptions."
A successful bidder must make full payment - either by cash, money order or cashier's check - to the Chancery Court within 24 hours of the sale. Gates said the law requires a 1-year redemption opportunity for the debtor, so the bidder's payment goes into a court escrow for one year.
"We do not recommend spending money to improve property bought at tax sale until after the 1-year redemption period expires. Such expenditures may or may not be reimbursed by the court," said Gates.
If the debtor should make good on the tax debt within the 1-year period, the court will return the bidder's payment in full, with interest.