What Happens If I Don't Pay Property Taxes in New Hampshire?

People who own real property must pay property taxes. The government uses the money these taxes generate to pay for schools, public services, libraries, roads, parks, and the like. Typically, the tax amount is based on a property's assessed value.

When homeowners don't pay their property taxes, the overdue amount becomes a lien on the property. A lien effectively makes the property act as collateral for the debt. All states have laws that allow the local government to sell a home through a tax sale process to collect delinquent taxes.

So, if you don't pay your real property taxes in New Hampshire, you might lose your home (or a portion of it) to a tax sale or to the municipality through an alternative procedure. But you'll have some time to pay off the debt and keep the property.

Is New Hampshire a Tax Lien State?

Again, if you don't pay your property taxes, the past-due amount becomes a lien on your home. Each state has a different tax sale process to collect delinquent taxes.

New Hampshire is generally considered a tax deed state.

Tax Deed States

In some states, if the homeowner doesn't pay off the debt, the taxing authority sells the home. However the purchaser might not get the deed to the property right away. Sometimes, a redemption period must expire before the buyer gets the deed.

Tax Lien States

In other states, the taxing authority sells the tax lien, and the purchaser must foreclose or use different procedures to get a deed to the property.

Other Tax Sale Procedures

And in other states, a tax foreclosure process is used, or the taxing authority simply executes its lien by taking title to the home.

What Are the Consequences of Not Being Able to Pay Property Taxes in New Hampshire?

If you don't pay your property taxes by December 1 following their assessment, the taxes are considered delinquent. (N.H. Rev. Stat. §§ 80:20, 80:59.)

When property taxes in New Hampshire are delinquent, the tax collector will eventually take steps to collect the delinquent amounts by:

• selling the property at a tax sale or
• using an "alternative tax lien procedure." (N.H. Rev. Stat. §§ 80:20, 80:20-a.)

Below is a summary of both processes. To find out what specific procedures are used where you live, consult with an attorney in your area.

How Property Tax Sales in New Hampshire Work

In some places in New Hampshire, the municipality can hold a tax sale and sell your home, or a percentage of it, to collect the unpaid taxes. (N.H. Rev. Stat. §§ 80:20, 80:24.) New Hampshire property tax sales are public auctions. (N.H. Rev. Stat. § 80:24.)

You would then get two years, called a "redemption period" (see below), to pay off the debt. If you fail to do so, the purchaser gets the property's title and becomes the new owner of your home. (N.H. Rev. Stat. § 80:38.)

How You'll Get Notice of a New Hampshire Property Tax Sale

Before the sale takes place, the collector must:

• post a notice in two or more public places in your town at least 25 days before the sale, and
• send you a notice by registered mail before posting the notice but not more than 30 days before the posting. (N.H. Rev. Stat. § 80:21.)

Can Someone Pay Unpaid Property Taxes in New Hampshire to Get the Property?

At the sale, the home is sold for the percentage of the common and undivided interest that a bidder is willing to offer for the amount of the unpaid tax, interest, and costs due thereon. (N.H. Rev. Stat. § 80:24).

How to Stop a Property Tax Sale in New Hampshire

You may pay the taxes and other property charges before the sale. (N.H. Rev. Stat. § 80:33.)

Can I Get My Home Back After a Property Tax Sale in New Hampshire?

If your New Hampshire home is sold at a tax sale, you will get two years after the sale to pay off the debt and keep your home (called "redeeming" the property). (N.H. Rev. Stat. §§ 80:32, 80:38.).

If you don't get caught up within the two years, the purchaser who bought the home at the sale can get a deed (title) to your property. (N.H. Rev. Stat. §§ 80:32, 80:38.)

You may redeem at any time before the collector issues the deed to the purchaser. (N.H. Rev. Stat. § 80:32.)

Notice Before the Purchaser Gets the Deed After a New Hampshire Tax Sale

At least 30 days before the purchaser gets the deed, you'll get a notice by certified mail letting you know about the impending deeding. If you redeem, you'll prevent the purchaser from getting ownership of your property. (N.H. Rev. Stat. § 80:38-a.)

How Much You'll Have to Pay to Redeem Your New Hampshire Home After a Tax Sale

To redeem your New Hampshire home after a property tax sale, you will need to pay:

• the price that the purchaser paid for the home at the tax sale
• interest at the rate of 14% per year, and
• costs. (N.H. Rev. Stat. § 80:32.)

Making Partial Payments to Redeem After a New Hampshire Property Tax Sale

Under New Hampshire law, you can redeem by making partial payments in the amount of $5 or multiples thereof to the tax collector during the two-year redemption period. (N.H. Rev. Stat. § 80:33-a.)

But if you don't pay the full amount needed to redeem before the purchaser who bought your home at the tax sale gets the deed to the property at the end of the redemption period, you'll lose your chance to redeem. You'll get a refund of the amounts you paid. (N.H. Rev. Stat. § 80:33-a.)

How the Alternative Tax Lien Procedure Works in New Hampshire

In other areas of New Hampshire, the municipality (or county or state, in some cases) will use an alternative tax lien procedure if it has adopted the legal provisions describing this procedure. (N.H. Rev. Stat. § 80:59.)

Once the procedure is complete, the municipality gets the title to your property. (N.H. Rev. Stat. § 80:76.)

How Do Tax Liens Work in New Hampshire?

To get ownership of your home through the alternative tax lien procedure, the municipality must "perfect" a lien on your home. "Perfecting" a lien means taking certain actions or following particular procedures to create an enforceable security interest.

Notice About the Property Tax Lien in New Hampshire

To perfect the lien, the tax collector must mail you a notice of the impending lien at least 30 days before executing the lien. (N.H. Rev. Stat. § 80:60.) "Execution" means that the lien is transferred over to the municipality.

How Long You Get to Redeem If the Municipality Uses the Alternate Tax Lien Procedure in New Hampshire

If the taxes remain unpaid for two years from the execution of the tax lien, the tax collector deeds the property to the municipality. (N.H. Rev. Stat. § 80:76.)

Notice Before the Municipality Gets Your Home's Deed

The collector will send you a notice by certified mail, return receipt requested, at least 30 days before the deed is issued. (N.H. Rev. Stat. § 80:77.)

Once the collector deeds the property to the municipality, the municipality can sell the home to a new owner.

How Much You'll Have to Pay to Redeem Your Home

To redeem your New Hampshire home before the municipality gets a deed to the property, you must pay the collector:

• the amount of the lien
• interest at the rate of 14% per year, and
• costs. (N.H. Rev. Stat. § 80:69.)

Making Partial Payments to Redeem in New Hampshire

Under New Hampshire law, you can make partial payments to redeem after the municipality gets a tax lien. (N.H. Rev. Stat. § 80:71.)

But if you don't pay the full amount needed to redeem before the municipality gets a deed to the property, you'll lose ownership of your home. You'll get a refund of the amounts you paid. (N.H. Rev. Stat. § 80:71.)

What Happens to My Mortgage in a Tax Sale?

Because a property tax lien has priority, mortgages (and deeds of trust) get wiped out if you lose your home through a tax sale process. So, If your loan isn't escrowed and you fail to pay the property taxes like you're supposed to, the loan servicer will usually advance money to pay delinquent property taxes to prevent a tax sale from happening.

Most mortgages have a clause allowing the lender to add the amount it paid to bring the taxes current to your loan balance. You'll then have to make repayment arrangements with the servicer or potentially face a foreclosure.

What Options Do I Have If I Can't Afford to Pay My Property Taxes in New Hampshire?

If you're having trouble paying your property taxes, you might be able to reduce your tax bill or get extra time to pay.

Getting Help

Talk to a foreclosure lawyer, tax lawyer, or real estate lawyer if you're facing the loss of your home due to unpaid property taxes in New Hampshire and have questions about the process or need help redeeming your property.

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.