Behind on your property taxes?

In Ohio, property taxes are collected twice per year and are billed at the end of the year in which they are assessed. Thus, taxes billed in December 2009 (and due in January 2010) were the taxes assessed for the first half of 2009. Second-half bills arrive in June and are due in July. Exact due dates are noted on the bill. Residents can pay once per year or in monthly installments, and payments can be withdrawn automatically from a bank account.

A payment is considered late at midnight on the due date. Property owners paying within the next five days are assessed a 5 percent penalty. After that, a 10 percent penalty applies.

If taxes become seriously delinquent, the county treasurer has two options: initiating a tax foreclosure (different from a mortgage foreclosure) or selling a tax lien in the amount of the unpaid taxes. The tax-lien approach offers advantages for both the individual taxpayer and the governmental units that depend on the property tax. The tax foreclosure process transpires quickly. The tax lien process, on the other hand, gives a property owner at least one year after a tax lien is sold to pay his or her taxes plus any penalties and interest costs.

If a tax foreclosure action is taken against a tax-delinquent property, the property is sold at an auction known as a sheriff’s sale. The minimum bid must cover all delinquent property taxes and related costs.

If a tax lien is sold on a property, an outside entity pays the county the entire amount of the overdue taxes on a property. The lienholder then earns 18% interest on the cost of the lien for one year. One year after the lien is purchased, the lienholder can foreclose on the delinquent property. During the year, the property owner has the right to pay all the delinquent taxes, penalties, and interest, in which case the lienholder is paid off and has no further rights to the property. A benefit to county taxpayers of this approach is that the lien purchaser pays 100% of the delinquent taxes at the time of lien purchase. Though the county has no further interest in the property, it is made whole without awaiting the resolution of a lengthy legal process.

What are you options if you are delinquent? If your property is placed on the foreclosure list due to unpaid real estate taxes, it  can be removed from the list before publication if you pay the full tax and interest for the years causing foreclosure. For assistance, call 216-443-7420, or go to the Taxpayer Services Division in Room 121 of the County Administration Building, 1219 Ontario St., 8:30 a.m. to 4:30 p.m., Monday through Friday.

Kimberly T. Dominique is a foreclosure counselor with the Home Repair Resource Center. Information for this article was drawn from the Web site of the Cuyahoga County Treasurer and the Ohio Revised Code.

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Volume 3, Issue 2, Posted 3:58 PM, 01.07.2010