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.
When you don't pay your property taxes in Ohio, state law allows the county treasurer to collect the delinquent amount by selling a tax-lien certificate. If a tax lien sale happens and you don't get caught up on the overdue amounts, the person or entity that bought the certificate may eventually foreclose on your home. Alternatively, Ohio law allows the county treasurer to choose to foreclose directly and, in the process, sell the property at a foreclosure sale to cover your tax debt.
Fortunately, after a tax lien sale and in a tax foreclosure, you'll have the opportunity to save your home by getting current on the past-due taxes, plus interest and various costs.
Again, in the case of a tax lien sale, the person or entity that buys the lien may eventually foreclose on your home if you don't get caught up on the delinquent amounts.
Following a tax lien sale, a one-year period has to expire before the purchaser can start a foreclosure to get ownership of your property. (Ohio Rev. Code § 5721.37). During this time, you can get caught up on the delinquent taxes, plus various other amounts, and prevent the purchaser from foreclosing. Even if the foreclosure has started, you get the right to redeem up until the court confirms the foreclosure sale. (Ohio Rev. Code § 5721.38).
The redemption price depends on whether you redeem before or after the purchaser starts the foreclosure.
Cost to redeem before a foreclosure starts. To redeem before the purchaser starts a foreclosure, you must pay an amount equal to the certificate price (or prices, if there is more than one tax certificate on your property), which includes taxes and fees plus interest. (Ohio Rev. Code § 5721.30, § 5721.38).
Cost to redeem after a foreclosure starts. To redeem after the purchaser starts the foreclosure, you must pay the certificate price plus 18% interest per year, attorneys' fees, costs, and other fees. (Ohio Rev. Code § 5721.38).
If you can't afford to pay the redemption amount all at once, you can enter into a payment plan with the county treasurer to get caught up on the delinquent amounts. (Ohio Rev. Code § 5721.38).
If the county treasurer forecloses instead of selling the lien, a court will eventually issue a judgment and sell your home at a public auction to a new owner. You get up until the court confirms the sale to redeem the property. (Ohio Rev. Code § 5721.25). You don't get a redemption period after the court confirms the sale.
To redeem before the county initiates the foreclosure, you must pay the overdue amount of taxes, assessments, charges, penalties, and interest. (Ohio Rev. Code § 5721.18, § 5721.25). If you redeem after the foreclosure begins, you'll have to pay the amounts stated above and costs, and you must also show that the property is in compliance with all applicable zoning regulations, land-use restrictions, and building, health, and safety codes. (Ohio Rev. Code § 5721.25).
If you haven't previously defaulted on a payment plan for delinquent property taxes, you may enter into a contract with the treasurer to pay off the debt. (Ohio Rev. Code § 5721.25).
Even though you'll get some time to redeem your Ohio home before you permanently lose ownership, 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 Ohio, 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.