Beginning on or before June 1st of each year, the Tax Collector is required by law to hold a tax certificate sale. The certificates represent liens on all unpaid real estate properties. A tax certificate sale is not a sale of land. The sale allows citizens to buy certificates for the amount of tax debt including applicable interest and fees. The sale is conducted in an online auction with participants bidding downward on interest rates starting at 18%. Bids are accepted in increments of a minimum of ¼ of 1%. The sequence number, as listed in the advertisement, will be called and the certificate will be awarded to the buyer who is willing to pay the taxes, interest, and associated costs at the lowest rate of interest.
The certificate is awarded to the lowest bidder. A tax certificate earns a minimum of 5% interest to the investor until the interest has accrued to greater than 5%, with the exception of "zero" interest bids, which always earn "zero" interest.
A tax certificate, when purchased, becomes an enforceable first lien against the real estate. The certificate holder is actually paying the taxes for a property owner in exchange for a competitive bid rate of return on his or her investment. Purchasing a tax certificate on a parcel does not entitle the certificate holder to enter the property or to initiate contact with the property owner. In order to remove the lien, the property owner must pay the Tax Collector all delinquent taxes plus accrued interest, cost, and other charges. The Tax Collector then issues a check to the certificate holder.
A tax certificate is valid for seven years from the date of issuance. The holder may apply for a tax deed when two or more years have elapsed since the date of delinquency. If the property owner fails to pay the tax debt, the property is sold at a public auction. The highest bidder will receive a tax deed for the property.
For more information or to register as a bidder, please visit the WCTC Auction website
Certificate buyers need to be aware that there are risks involved with buying tax certificates, and those risks are borne by the certificate holder.