If you’re a property owner in New Jersey, it’s important to understand how tax liens work and what your rights and responsibilities are in the process.
What is a tax lien?
A tax lien is a legal claim against a property owner’s assets, including real estate, for unpaid taxes. This means that the government has a legal claim to your property if you don’t pay your taxes. This typically happens if your taxes go unpaid for two to three years
The process of imposing a tax lien
In Passaic County, when the government imposes a tax lien, the county files a notice with the county clerk’s office, which then becomes a matter of public record.
This means that the lien is visible to anyone who searches for information on the property, including potential buyers, lenders, and other interested parties. Additionally, once the county notifies an owner of a lien against their property, the owner may face additional penalties and fees, as well as potential legal action, if they continue to neglect their tax payments.
The property title
When the county begins a tax lien, it becomes a legal claim against the property. This means that the property owner cannot sell or refinance the property until they have satisfied the tax lien. However, the property owner still holds the title to the property.
The tax sale
If a tax lien remains unpaid, the local government may hold a tax sale to recover the unpaid taxes. At a tax sale, the government sells the tax lien to the highest bidder, who then has the right to collect the unpaid taxes plus interest from the property owner.
Rights and responsibilities of property owners
If you’re a property owner facing a tax lien, you have options. You can request a tax lien redemption (the form is available on the Passaic County website. A redemption allows you to pay off the unpaid taxes plus interest and have the lien removed from your property. You can also appeal the tax lien if you believe it was imposed in error.
Know the law and act quickly to protect your rights
Tax liens can be a complicated and stressful process for property owners, but understanding the basics can help you navigate the system and protect your property. If you’re facing a tax lien, don’t hesitate to take the steps you can take to protect your property and your rights.