Purchasing Tax Lien Property in Colorado that also has IRS Lien

[Kevin S.]

Hello All,

It's my understanding that a county tax lien has priority over any other liens---so basically everything else is wiped out. I'm looking to purchase a tax lien property from another investor. The property is located in Colorado and has multiple judgments, a deed of trust, as well as an IRS tax lien against it. Can anyone advise as to whether these all get wiped out from the county tax lien? I'm looking to purchase the property and will apply for treasurer's deed in October. Then will likely proceed with quiet title action as there is sufficient value in the property to make it worthwhile. Perhaps @Wayne Brooks could respond?

Thanks!

Kevin

[Jerry K.]

I'm not familiar with CO law. Talk with a CO real estate attorney who specializes in tax lien foreclosures for your state. My experience with AZ tax lien foreclosures is all lien holders get notified of the tax lien foreclosure. Those lien holders (except the IRS lien) are below the real estate tax lien in precedence. Those subordinate lien holders would have to pay the tax lien holder their principal and interest in order to keep their own lien viable. If none of the subordinate lien holders pay off the real estate tax lien holder, then the foreclosure judge can grant the parcel to the tax lien holder - which makes the subordinate liens null and void (wipes them out). This is only for a "judicial" tax lien foreclosure like they do in Arizona. Not sure about Colorado or other states. Again, I'm not a lawyer so take my statements as being only from an investor.