If I owe back property taxes and the county puts my house up for auction, will I still have to pay the mortgage?

I own a small house that is in terrible shape. It is unoccupied. I do have a home equity loan on it in which I owe about 18,000. The house could not sell for even $10,000. I owe $8,000 in property taxes which I cannot pay.

Asked on July 26, 2012 under Real Estate Law, Texas

Answers:

FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 8 years ago | Contributor

If you lose legal title to your home for failure to pay back taxes you essentially have no reason to pay the mortgage on it since you no longer own it. If the home is sold at a tax sale for unpaid property taxes, the buyer at auction takes title to the home free and clear of the mortgage on the property.

In essence the mortgage is wiped out where you end up being responsible for the balance of it. I suggest that you consult with a real estate attorney about your matter and figure out a way to raise the property taxes owed or face more problems if the home is lost in a tax sale.


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