Tax sale withdrawn 3rd day of online auction

[Suresh Batta]

I'm witness to a recent tax sale withdrawal on ************** that doesn't seem right. Usually I see all withdrawals happen the day before auction(last day for redemption). 

For this particular lot sale which was offered at a lower starting bid second time same year for 18k (because someone who bid $54k for a 27k tax default amount apparenty did not pay up), the withdrawal happened the 3rd (last) day of auction.

I called county and I was informed by Asst. Tax Collector that it was withdrawn because:

- a lien holder on the property bought some sort of legal action to stop the sale and paid taxes while auction was in progress
- county did not identify the lien holder during notice period. I highly doubt it because I got prelim title report from local title company(for free) and the only lien on it other than tax lien was a deed of trust. Seemed hard to miss.

Can county tax office legally let people pay their taxes when the auction started?

I'm not aware of laws but why would anyone waste their time and participate in an auction knowing redemption can stop the sale any minute while you are bidding on it?

What do you think?

[Blair Poelman]

Each state has different redemption periods and laws.  Some can redeem up until the auction, some 6 months or even a year or more after the auction.  

Before buying at a tax auction you really need to know the redemption periods (along with a TON of other stuff - and even then there is still a risk).  It's a risk that you have to consider and you may or may not be comfortable with it.  If you don't understand how it works, and you're not comfortable with the risk then you shouldn't buy.

We've all heard of somebody filing bankruptcy to stop a foreclosure - that might be what happened.   There are ways to pull something out of the auction.