The Clerk (or Comptroller in some cases) does not guarantee title
Those of you who have attended the tax deed auctions are very familiar with that term. The clerks gives this warning at the beginning of very auction. For such a small sentence it carries A LOT of weight. Why is this that important? This can mean you the property you bought can and will be subject to: taxes for the current year, Federal Tax Liens, and Municipal and Special District taxes, if any. And possible other liens if the tax deed process was not conducted properly. This is why you want to make sure you are really buying what you are bidding on and you have fully researched the property and looked at a complete title search history.
Let’s say you make a mistake and catch it in time and decide not to pay for the property after you have bid. Well, if you are in Orlando the Orange County Comptroller’s rules clearly state, “The first time a bidder defaults on a bid, s/he will be banned for the next 12 months from participating in our tax deed sale auctions. If the bidder defaults a second time, s/he will be banned for three years.” At this point you might be thinking you can outsmart them and bring someone else to bid for you until your ban is lifted, WRONG. The rules go on to say, “If it is determined that the high bidder designates someone else to bid for him or her at future sales of the parcel which said high bidder defaulted on, said high bidder will be banned from future tax deed sales for a specified period of time. Additionally, the Comptroller may recommend legal action regarding any bidder who defaults at any time.”
Bottom line, it’s not worth the hassle to bid on property you haven’t done your research on.
Originally posted to Blog on 12/7/2012