Buying a Tax Sale property from Sheriff in Philadelphia

[Nathan J.]

Hi there, 

I recently bought a tax sale from a Sheriff's sale in Philly (via a wholesaler). I admit i am a novice here but was willing to take the risk since it was a very cheap duplex. I plan to rehab it then rent it out and hold it for 5-10 years. My questions and assumptions are the following:

1. The previous owners have one year to make a claim in court. If they won they would have to purchase at my purchase price plus the cost of any rehab done. At the end of this year nobody can contest it. Is that all right?

2. Any previous unpaid taxes or utility bills against the property are wiped clean at purchase. Is that right?

3. After one year I should be able to get a title company to insure it. Right?

4. What else should i do so that eventually when i want to sell there are no issues. In fact what should i do to prevent issues while I own.

Thank you in advance,

[Steve Babiak]

The redemption period as stated in the OP is not quite accurate. The statute gives a redemption period of nine months from the date that the sheriff's deed is recorded; given that the sheriff's deed might take less than three months to record, then the one year approximation is close enough - but in the suburbs (and I imagine this can occur in the city as well) I have seen a sheriff sale challenged and that dragged on for close to a year after which the sheriff's deed was issued and recorded AND then after that the nine month redemption period started.  

I am not sure if the redemption price would include rehab costs. Holding costs and costs to secure and preserve are included IIRC. 

You should look up the PA state statute to get the details (yes the Philadelphia tax sale is governed by state laws).  See link:

http://www.legis.state.pa.us/WU01/LI/LI/US/PDF/192...

Wherever you see that link refer to a city or county of the "first class" - that is PA state legislation code for Philadelphia ;)