Understanding Alabama’s New Tax Lien Foreclosure Requirements: Why You Need a Lawyer

Understanding Alabama’s New Tax Lien Foreclosure Requirements: Why You Need a Lawyer

The Alabama Legislature recently passed amendments to Alabama’s tax lien foreclosure requirements. If you have purchased properties at a tax sale or hold tax lien certificates you need to know about the recent changes. The revised law, outlined in Alabama Code § 40-10-180 et seq., mandates a series of new procedural steps before filing a tax lien foreclosure action in court. There are also new rights for original owners and their heirs. It is now more important than ever to have a lawyer on your side who can ensure the process is handled in compliance with the law. In this post, we’ll break down the new requirements:

Timing of the Foreclosure: Previously, the law allowed filing of a foreclosure or quiet title action as soon as the tax sale purchaser received a tax deed. Now, foreclosure actions can only be filed between four and ten years after the tax lien auction or sale.

Payment of Outstanding Obligations: Now the lien holder must ensure that that if any unsold tax liens remain on the property, the purchaser must pay all outstanding taxes, interest, penalties, fees, and costs before initiating a foreclosure action.

Pre-Filing Notice Requirements: Prior, there was no requirement to notify any previous owner or party prior to filling a lawsuit. The law changed to required, certified notice of intent to foreclose to previous owners and parties be sent at least 30 days (but no more than 180 days) before filing a lawsuit to foreclose.

Rights to Redeem: Previous owners and their heirs now have different rights to redeem properties that were sold at past tax sales. Understanding how to navigate these requirements and secure title to the property that you have invested time, sweat, and money is essential. Alternatively, if you received notice of a foreclosure action, understanding your rights is essential.

Alabama’s updated tax lien foreclosure requirements emphasize clarity, accountability, and compliance. By hiring a knowledgeable real estate attorney, you can confidently navigate this process. Legal assistance ensures that statutory requirements are met, helping you avoid unnecessary complications and achieve your desired outcome. Whether your goal is obtaining marketable title and foreclosure or redeeming property you must understand your rights and obligations. If you have questions about Alabama’s tax lien foreclosure requirements or need assistance with an action, reach out to a real estate attorney to guide you every step of the way.