Alabama Tax Certificates

[Eric Gay]

Hi all!

In Alabama, I can buy a tax certificate from someone who obtained it from auction. They’ll mark the price up when they sell it. So if I buy a $2000 certificate for $3000 as an example, and the owner decided to redeem, am I out the difference of $1000 because the cert was only for the $2000 delinquent? How does a tax certificate change hands?

Thanks!

[Denise Evans]

@Eric Gay, you are out $1,000. Do not believe people who tell you a property is abandoned and you can go in and change the locks and immediately make repairs and increase the value enough so it will be more than $3,000 to redeem. If you do not enter lawfully, you will not be paid for repairs. In fact, you will be sued and will have to pay actual and possibly punitive damages. There are only three ways to gain lawful possession (1) the owner surrenders possession to you and you have it in writing so you have proof in case he/she later lies about it; or (2) the property is abandoned, which is different from vacant and neglected for a long time. Abandoned means the owner has no intention of ever returning, ever selling the property, ever donating to a church, ever doing anything. That is virtually impossible to prove. (3) you have an ejectment order from a court after filing an ejectment lawsuit against the owner.  Please be VERY careful about paying premiums above redemption prices on property.