How to Buy Property for Back Taxes in Missouri

How to Buy Property for Back Taxes in Missouri
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If you want to be a property owner, you could consider purchasing Missouri property that owes back taxes. These refer to taxes that property owners may not have paid or paid partially during the year that they are due. Since the IRS has ​10 years to collect those taxes, it tends to do so before the time elapses. Beyond that period, it cannot recover the monies people owe.

Purchasing a Missouri property through back taxes is an affordable way to buy land. A Missouri property that is delinquent on taxes for about​ three years may be sold at a public auction. However, some properties that are delinquent on taxes may be auctioned earlier. If the property is bought, the buyer is issued a Tax Sale Certificate of Purchase.

Missouri Back Taxes Property Buyer Eligibility

To be eligible as a buyer purchasing Missouri property in a tax sale, you must meet specified criteria.

First, you cannot participate in the auction if you are delinquent on any tax payments except on the property on sale. If you are a Missouri resident, you swear an affidavit stating that this is the case and then you can bid for the property you desire through an agent or in person.If you are not a Missouri resident, you can only bid a county citizen as your agent. But first, you must write an agreement stating you will be subject to the local jurisdiction concerning solving any issues that may arise due to the property sale.

In addition, your agent must also sign an affidavit stating that they are not delinquent on their taxes. You must have money to pay your bid immediately. Otherwise, the property you want will be auctioned again.

How to Buy Back Taxes Houses for Sale

Below are the steps you can take to buy back taxes houses for sale in Missouri.

  1. Decide which county in Missouri you would like to own property in. But first, ensure that you meet all the eligibility requirements for tax sale participants.
  2. Pull a list of properties that will be sold in your county of choice. Some counties publish the delinquent tax list in Missouri online at the county collectors’ websites, while others publish it in county newspapers at least ​15 days​ before the sale. Decide what property you would be interested in bidding on and prepare yourself for the auction by knowing how much is owed in back taxes. Be sure to factor in all the penalties.
  3. Attend the county back tax sale or have your designated eligible agent represent you. State law requires that the sale be held every year on the fourth Monday of August, in or near the county courthouse at 10 a.m. It then runs from day to day until all available property parcels are sold out.
  4. Bid on the property you would like to purchase. If you are the highest bidder, you will need to pay your bid amount immediately after the completion of the sale. Then you will be issued a Tax Sale Certificate of Purchase.
  5. Wait for the specified "Right to Redeem" period to expire. This period varies in length depending on the county. Typically, the period lasts ​one year ​in Missouri. However, if the home has been sold on the third sale, the homeowner only has ​90 days​ to redeem the property. Also, some counties tend to gauge the length of how many years the taxes have been delinquent. And people with issues such as disabilities or minors may get several years to do so.
  6. Continue to pay property taxes on the property during the "Right to Redeem" period. If the original owner pays the county collector the total of the back taxes, interest and other associated costs at any time during that period, the property will be deeded back to him.
  7. Apply for and record a Collector's Deed once the "Right to Redeem" period concludes. The property then belongs to you.

Things to Be Cautious About

You must inform interest parties about your intention to fully own the property you buy at the tax sale auction. So, start by conducting a title search of the public record for the property at least ​90 days​ before the conclusion of the "Right to Redeem" period.

If there are any liens on the property, you must alert the lien holder and the previous owner, in writing, by certified mail, of your intent to apply for a Collector's Deed. If you do not hear back in ​90 days​, they forfeit their right to hold the lean against the property.

The original owner has a specified amount of time to redeem his property by paying all of the back taxes, interest, and other associated costs. So, if the property is redeemed, it transfers back to the original owner. If it's not, the property belongs to the new owner.

For that reason, you need to remember that you will not receive any compensation for any improvements you make to the property should the original owner redeem his property during the specified time. To avoid the risk of losing your investment, you should refrain from making any improvements until you have a Collector's Deed in hand.