LIEN FORWARD OHIO
General Description of Lien Purchase and Land Title Transfer Process
Note: Buying a lien is not the same as owning property. The delinquent tax lien is a tool to facilitate taking ownership of the land itself. In using this program, the Interested Party is NOT purchasing property, but rather purchasing the delinquent tax lien against the property. In order to assure the lowest possible lien acquisition cost, the Interested Party should always work through the Lien Forward Ohio Office to acquire the lien. The intent of this program is to address vacant, abandoned, tax-delinquent land. Fees are higher for parcels with structures.
STEP 1: The Interested Party completes a Lien Transfer Request form indicating the intended use of the land and returns the form to Lien Forward Ohio for processing.
STEP 2: When American Tax Funding is the lien holder, the Lien Forward Ohio staff calculates the cost to purchase the tax lien and informs the Interested Party. Cost: Normally between $50 and $110.
Note: If the lien holder is anyone other than ATF, the Lien Forward Ohio staff will provide contact information to the interested part, who must obtain pricing and purchasing information for the lien.
STEP 3: The Lien Transfer Request form is forwarded to Lien Forward Ohio’s Lien Transfer & Grant Review Committee for review of intended property use and approval of the lien transfer.
STEP 4: Upon the committee’s approval, American Tax Funding, LLC is notified by the Lien Forward Ohio Office and directed to sell the tax lien to the Interested Party for the predetermined price. The Interested Party is informed of the approval.
STEP 5: Lien Forward Ohio contacts American Tax Funding directly to make arrangements for payment to acquire the lien. ATF will mail the tax certificate to Lien Forward Ohio.
STEP 6: Lien Forward Ohio resells the lien to the Interested Party. Cost: Lien purchase price plus $10 administrative fee per parcel.
STEP 7: To protect your interest, Lien Forward Ohio will update the lien register at the Mahoning County Treasurer’s Office at no charge to the Interested Party. In addition, Lien Forward Ohio Office encourages the Interested Party to record the tax certificate in the County Recorder’s Office. Cost: About $28.
STEP 8: Ask the Lien Forward Ohio staff when you can contact the property owner. A lien holder cannot negotiate with the property owner for at least one year from the original date that the Treasurer sold the tax lien to American Tax Funding, according to state law. In the meantime, the Lien Forward Ohio Office will continue to educate delinquent property owners about their options, which includes signing over the property deed to the lien holder.
STEP 9: If a year has passed since the Treasurer first sold the tax lien, as described in Step 7, the new lien holder has the legal right to pursue ownership of the property. There are two (2) options:
OPTION 1: The new lien holder negotiates directly with the current property owner. This is the quickest way to acquire the property. If the current owner can be located and is willing to deed the land to the lien holder, these steps are followed:
· A title search should always be done in advance, to determine the property’s status and to ensure there are no additional liens against the property. The Lien Forward Ohio Office can recommend local title companies that may be willing to perform the title search for a reduced fee. Cost: About $180.
· The property title is transferred through the County Auditor’s Office. Associated fees are property specific. Cost: About $5.
· The new title is then recorded in the County Recorder’s Office. Cost: Normally $56.
· The tax certificate that was recorded in Step 6 must be released in the Recorder’s Office. Cost: About $32.
OPTION 2: If the property owner cannot be located, or if the land transfer cannot be negotiated, with the assistance of an attorney a foreclosure action can be filed in the Mahoning County Clerk of Courts Office.
Foreclosure expenses vary and will include:
· Title search. Cost: About $180.
· Filing fees (including certified mail). Cost: Normally $200 to $300.
· Attorney fees. Cost: Free use of LFO staff attorney for qualified clients; discounted rates for overqualified clients. Other lawyers’ rates are privately negotiable.
Additional costs also will usually include:
· Advertising expense to notify interested parties, if certified mail did not provide adequate service. Cost: Approximately $300 to $400.
In the case of the vast majority of parcels eligible for lien transfer under this program, a Sheriff’s Foreclosure Sale will not be required. After the initial filing and notifications, the Court will simply order title to be transferred to the lien holder.
If the Court does order a Sheriff’s Sale for some reason, further costs may include additional advertising expense and a Sheriff’s fee.
As is the case in Option 1, expenses after title is transferred will include:
· Transferring the property title through the County Auditor’s Office. Cost: About $5.
· Recording the new title in the County Recorder’s Office. Cost: Normally $56.
· The tax certificate that was recorded in Step 6 must be released in the Recorder’s Office. Cost: About $32.
If you have any questions, please contact Lien Forward Ohio at (330) 259-1040.
Element of Risk
It is important to remember that the element of risk is involved with the purchase of tax liens. In addition to the delinquent taxes, there may be other liens on the property for non-payment of a debt. Title work must be used to reduce the possibility of incurring any debt that is attached to the parcel of land.
Parcels are subject to federal, state and local government regulations including, but not limited to, land use and environmental regulations.
(Rev: May 2007)