What Happens if I do Not Pay My Property Taxes?

We are often asked the question, What happens if I do not pay my property taxes? Property owners who do not pay their property taxes face stiff penalties and the possibility of a law suit by the tax assessor to foreclose their home. Detailed below is a generalized overview of issues property owner face when they fail to pay their property taxes:

1) Penalties and Interest – In most Texas Counties Taxes are due on January 30^th. Failure to pay on the due date results in a penalty equal to 7% of the tax bill. Each subsequent month thereafter, a 2% per monthly interest charge is added to the account.  If the taxes remain unpaid after June 30^th another 20% collection charge is added to the account. After June 30^th most counties continue to assess a 1% per month interest charge. The total of all interest, penalties and collection charges total 44%. These penalties and charges reflect those of the typical Texas Taxing Authority.

2) Law Suits and Litigation – Tax Assessors can file a law suit to collect past due taxes as soon as they become delinquent on January 30^th.  As a practical matter, most Tax Collectors want the revenue from interest and penalties and historically it was not uncommon for them to wait years after taxes are due to file a law suit. However, given that most counties are struggling with their budget, the trend now is for the tax assessor to file within 7 – 12 months of the delinquency.

Once a law suit is filed, property owners are served with a legal complaint and a court hearing is set. At the hearing the property owner has the opportunity to provide evidence that the amount due or law suit is not valid. If it is determined by the judge that the taxes are due, a judgment is entered in favor of the county. The county can then fill a writ of execution on the judgment to foreclose the property to sell it for the past due taxes. Before the sale date is set, the county is required to advertise the pending sale in legal and local news publications. Once the advertisement requirements are met, a sale date is set. In most counties sales are held on the first Tuesday on each month.

Failure to pay your property taxes can result in costly penalties and the eventual loss on the property through a foreclosure sale. A property tax loan is a fast and economically viable solution for most property owners that fall behind with the property taxes.