If you fail to pay your property taxes, the past-due amount becomes a lien on your home. This type of lien almost always has priority over other liens, including mortgages. Generally, when taxes remain unpaid, the taxing authority will eventually sell the lien (and if you don't pay the past-due amount to the lien purchaser, that party can foreclose or use some other method to get title to the home), or sell the property itself in a tax sale. Though, in some places, a sale isn't held; instead, the taxing authority executes its lien by taking title to the home. State law then generally provides a procedure for the taxing authority to dispose of the property, usually by selling it. In other jurisdictions, the taxing authority uses a foreclosure process before holding a sale.
In Florida, the tax collector will initially sell the tax lien in a tax lien sale. The purchaser at the tax lien sale gets a tax certificate and the right to collect the delinquent tax debt from you, plus interest. The winning bidder at the tax lien sale will be the person who charges the lowest interest rate on the debt. Eventually, the tax collector can sell the home at a public tax deed sale if you don't get caught up on the past-due amounts.
In most states, delinquent taxpayers get some time during which they can redeem the home after a tax sale by paying the buyer the amount paid at the sale or paying the taxes owed, plus interest, penalties, and costs. In some states, the redemption period occurs before the sale. But if you don't redeem, the purchaser can get title to the home free and clear of any liens that existed before the sale.
Under Florida law, you get at least two years after the tax lien sale to redeem the property before it's sold at a tax deed sale. That's because the lien purchaser must wait two years from April 1 of the year that the tax certificate is issued before submitting an application for a tax deed to the tax collector. (Fla. Stat. § 197.502). The application triggers a tax deed sale.
And if seven years pass after the date of the tax certificate's issuance, but the purchaser doesn't submit an application for a tax deed, and no other administrative or legal proceeding, including a bankruptcy, is on record, the tax certificate expires and becomes null and void. (Fla. Stat. § 197.482).
So long as the purchaser applies for a tax deed before the certificate expires, the clerk of the circuit court will hold a tax deed sale. The home is sold at a public auction to the highest bidder. (Fla. Stat. § 197.502).
You can redeem after a tax sale, but you'll have to act fast. You can redeem up until:
If you plan on redeeming the property, it's a good idea to pay off the tax debt well before the sale happens.
To redeem the property, you'll have to pay the face amount of the tax certificate, along with interest and costs. (Fla. Stat. § 197.472).
You might also have to pay a mandatory minimum charge of 5% if the lien purchaser bid less than 5% interest on the debt when buying the lien. But if the purchaser bid an interest rate of 0% when buying the lien, then you don't have to pay this charge. (Fla. Stat. § 197.472).
Even though you'll get some time to redeem your Florida home before losing it to a tax deed sale, in most cases, it's better to take action earlier to try to make your taxes more affordable. For instance, before you fall behind in your taxes, you could:
If you want more information about property tax and redemption laws in Florida, consider talking to a foreclosure lawyer, tax lawyer, or real estate lawyer who has experience with property tax issues. To learn more about property taxes and other aspects of homeownership in general, get Nolo's Essential Guide to Buying Your First Home by Ilona Bray, J.D., Attorney Ann O'Connell, and Marcia Stewart.