Homeowners face potential foreclosure for non-payment of multiple types of tax. Nonpayment of county property taxes often leads to a tax lien, which sometimes lead to foreclosure. The federal government and some state governments also uses tax liens to secure payment on income taxes. 

Tax foreclosure on a tax lien occurs if the homeowner does not respond to the lien by paying it. This leads to tax-certificate sales to investors. The investors bid on how much interest they will accept on the tax debt, and homeowners must pay the winning investor this interest on top of the debt originally owed under the tax lien. When a homeowner fails to pay these debts, the investor can request a foreclosure sale. The original homeowner loses their home, and the investor receives payment from the new home buyer.

Many homeowners erroneously believe mortgage lenders cannot foreclose on them, even if timely mortgage payments are made. However, mortgage companies have the right to foreclose on properties when a tax lien is attached to them.  This protects their investments.

According to a June 2010 article in the "St. Petersburg Times," the Federal Housing Administration and giant mortgage lender, Fannie Mae, instructed their mortgage lending partners to initiate foreclosure when homeowners fail to pay property taxes and home insurance.

If you find yourself in one of these situations, please contact us at BirmingHome immediately for help. 

​​​​​​Owning a home brings many financial responsibilities. Two of the most crucial are paying a mortgage and real estate taxes. Failing to pay either can bring dire results for homeowners.

In times of financial hardship, some homeowners might opt against paying property taxes in favor of making a mortgage payment, but there are consequences.