Tax lien foreclosure in Wyoming…Post 161

Has anyone heard of buying tax foreclosure property in Wyoming?

February 1st, 2011

I saw a blog and the 5 comments had lots of inaccurate information.

I thought you should be apprised of what passes for informed thought in America these days. I indicated the incorrect comment in bold and labeled it (INCORRECT) I left the 5 comments intact so as to retain the context of their comment. My observations are at the end.

Coach Mitch


The blog

I was told you can buy a house at one of these government tax foreclosure sales for about 0, and the house is worth a whole of a lot more like a house of the value of 0,000. All you have to pay is the property tax light, water… and the house is legally yours? Has anyone else heard about this, is what I been told accurate? Where else can I find out about this type of sale my self, Thanks for your help.


1. D…K says:

February 1, 2011 at 9:36 am

You are looking for are tax sales and sheriff sales. These are typically posted at your local county court house. Go to the court house and ask at the assessment office, or tax claim. One or the other will send you where you want to go. Every so often they have auctions for the properties.

Where you have to be careful is if you purchase a property that still has a mortgage lien on it. You buy it for back taxes but you are also buying the old mortgage too. (INCORRECT #1) You’ll have to do a title search of sorts to see what else, if anything, is owed on the property. With declining values, bad mortgage choices, etc you can purchase a property that has more owed on it that it is worth (negative equity).

Sometimes financial institutions that hold mortgages on these properties will purchase the properties at those auctions. (INCORRECT #2) Then they may put it with your local real estate agent. There are some deals to be had at this level as well.

Good luck.

2. e…s says:

February 1, 2011

It sounds like you are repeating an ad you saw on tv. I don’t know what happens elsewhere, but in my state there are a handful of companies that come in and buy tax certificates on properties with delinquent taxes. Once they have purchased 3 tax certificates (meaning property taxes have not been made in 1-1/2 years), they can foreclose on the property. If the owner cannot pay what is owed, then the company takes it.

I have not heard of individuals purchasing property this way. (INCORRECT #3)

3. L…7 says:

February 1, 2011

Not true because the mortgage company still has a lien on the home. Just because it was tax foreclosed doesn’t mean you get it free and clear. (INCORRECT #4) Beware of action to quiet title in this case. The mortgage lender will more than likely fight you.

I imagine if they couldn’t pay the taxes the home definitely was not out from under mortgage. (INCORRECT #5)

4. j…6 says:

February 1, 2011

yes, you pay the back tax’s and any outstanding utility’s, but be aware if the home is still in the delinquent tax payers name, (INCORRECT #6) some states require you to give the original owner a set time period to repay you, before finely ownership is turned over to you, you need to check with the town or county where the property is will want to find out this information before you put your money. play it smart and you can make money. good luck

5. a…l says:

February 1, 2011

What you have been told is grossly inaccurate. In those states which offer ‘tax lien’ sales, you buy the tax lien, and, IF the owner does not redeem the property under law, you get the property, ALONG with any other outstanding liens, which include mortgages owed. (INCORRECT #7) You might think you got a deal, only to find out that you bought a property worth $180K, with $200K worth of liens against it.

In those states where auctions are held to dispose of properties due to back taxes, you can expect a veritable crowd of bidders there who will bid that property up to not far from actual market value.

You CAN get deals at such auctions, but there’s NO way you’re going to buy a $180K house for $600. That’s thinking akin to Fool’s Gold being worth a fortune.(INCORRECT #8)


Coach Mitch’s REFLECTIONS™


The facts about Wyoming

  • Wyoming is a tax lien state
  • with a 1.25% per month interest penalty,
  • 18% per year.
  • A delinquent taxpayer has 48 months to redeem
  • or the senior tax lien holder can apply for a Sheriff’s Deed.
  • The deed and the property will come with no other liens attached.

See for yourself: Wyoming tax lien legislation


3-18-108 (d) (ii)

Referring to the tax sale…“The action shall be conducted in a manner similar to foreclosure of mortgages and sales thereunder”

In a mortgage foreclosure action, any lien junior to the foreclosing lien is extinguished. If there are three mortgage liens against a property and the 2nd lien forecloses, then the 2nd lien must pay off the 1st lien and the 3rd lien is extinguished. The only way the 3rd lienholder stays valid is if the 3rd lienholder pays off the other two more senior liens. Utility liens are also extinguished as are any other liens, even IRS liens, which go with the person.

3-13-108 (d) (iii)

Upon a tax delinquent not redeeming within 48 months and the senior tax lien holder having done the proper noticing, a tax deed can be applied for…“Upon confirmation of the sale by the court, the sheriff shall execute a deed conveying title to the real property to the purchaser in fee simple subject only to the rights of lienholders from junior tax sales.”

Wyoming law clearly states that only junior tax liens are to be honored. All other liens are wiped out, including mortgages and IRS liens.

In tax foreclosure, in all states excepting two, all mortgages are wiped out, and so are all other junior liens excepting in rare exceptions

(INCORRECT #1, #4, #7) See Wyoming law – all liens are wiped out.

(INCORRECT #2) The bank is noticed prior to the tax auction and typically redeems the property by paying the back taxes. After the tax redemption the bank will pursue a regular mortgage foreclosure.

(INCORRECT #3) I have.

(INCORRECT #5) About 40% of tax deed sale properties are free and clear. That is why I think this area of real estate investing is so lucrative. Prior to the tax deed sale, owners have 100% equity, and they can give it away if they choose.

(INCORRECT #6) In whose name would the property be except the tax delinquent’s?

(INCORRECT #8) When attending tax auctions these days, the bids will often go up to approximate the properties retail value. And it is not often the case, but smart buyers will still get great deals. I recently got a communication from someone stating that he had recently gotten a number of properties at a tax sale with none being more than 40% of fair market value.

Due diligence

Hopefully this little lesson showed that good information is key.  A coach would know the correct information.  A coach is your insurance policy.

See Coach Mitch’s “Ridiculously Simple System…” ™ for details.

Be careful out there,

Mitchell Goldstein - Coach Mitch
518-439-6100 until midnight EST

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