Subtitle E. Collections and Delinquency
Chapter 34. Tax Sales and Redemption
Subchapter B. Redemption
(a) The owner of real property sold at a tax sale to a purchaser other than a taxing unit that was used as the residence homestead of the owner or that was land designated for agricultural use when the suit or the application for the warrant was filed, or the owner of a mineral interest sold at a tax sale to a purchaser other than a taxing unit, may redeem the property on or before the second anniversary of the date on which the purchaser's deed is filed for record by paying the purchaser the amount the purchaser bid for the property, the amount of the deed recording fee, and the amount paid by the purchaser as taxes, penalties, interest, and costs on the property, plus a redemption premium of 25 percent of the aggregate total if the property is redeemed during the first year of the redemption period or 50 percent of the aggregate total if the property is redeemed during the second year of the redemption period.
(b) If property that was used as the owner's residence homestead or was land designated for agricultural use when the suit or the application for the warrant was filed, or that is a mineral interest, is bid off to a taxing unit under Section 34.01(j) or (p) and has not been resold by the taxing unit, the owner having a right of redemption may redeem the property on or before the second anniversary of the date on which the deed of the taxing unit is filed for record by paying the taxing unit:
(1) the lesser of the amount of the judgment against the property or the market value of the property as specified in that judgment, plus the amount of the fee for filing the taxing unit's deed and the amount spent by the taxing unit as costs on the property, if the property was judicially foreclosed and bid off to the taxing unit under Section 34.01(j); or
(2) the lesser of the amount of taxes, penalties, interest, and costs for which the warrant was issued or the market value of the property as specified in the warrant, plus the amount of the fee for filing the taxing unit's deed and the amount spent by the taxing unit as costs on the property, if the property was seized under Subchapter E, Chapter 33, and bid off to the taxing unit under Section 34.01(p).
(c) If real property that was used as the owner's residence homestead or was land designated for agricultural use when the suit or the application for the warrant was filed, or that is a mineral interest, has been resold by the taxing unit under Section 34.05, the owner of the property having a right of redemption may redeem the property on or before the second anniversary of the date on which the taxing unit files for record the deed from the sheriff or constable by paying the person who purchased the property from the taxing unit the amount the purchaser paid for the property, the amount of the fee for filing the purchaser's deed for record, the amount paid by the purchaser as taxes, penalties, interest, and costs on the property, plus a redemption premium of 25 percent of the aggregate total if the property is redeemed in the first year of the redemption period or 50 percent of the aggregate total if the property is redeemed in the second year of the redemption period.
(d) If the amount paid by the owner of the property under Subsection (c) is less than the amount of the judgment under which the property was sold, the owner shall pay to the taxing unit to which the property was bid off under Section 34.01 an amount equal to the difference between the amount paid under Subsection (c) and the amount of the judgment. The taxing unit shall issue a receipt for a payment received under this subsection and shall distribute the amount received to each taxing unit that participated in the judgment and sale in an amount proportional to the unit's share of the total amount of the aggregate judgments of the participating taxing units. The owner of the property shall deliver the receipt received from the taxing unit to the person from whom the property is redeemed.
(e) The owner of real property sold at a tax sale other than property that was used as the residence homestead of the owner or that was land designated for agricultural use when the suit or the application for the warrant was filed, or that is a mineral interest, may redeem the property in the same manner and by paying the same amounts as prescribed by Subsection (a), (b), (c), or (d), as applicable, except that:
(1) the owner's right of redemption may be exercised not later than the 180th day following the date on which the purchaser's or taxing unit's deed is filed for record; and
(2) the redemption premium payable by the owner to a purchaser other than a taxing unit may not exceed 25 percent.
(f) If the owner of the real property makes an affidavit that the owner has made diligent search in the county in which the property is located for the purchaser at the tax sale or for the purchaser at resale, and has failed to find the purchaser, that the purchaser is not a resident of the county in which the property is located, that the owner and the purchaser cannot agree on the amount of redemption money due, or that the purchaser refuses to give the owner a quitclaim deed to the property, the owner may redeem the land by paying the required amount as prescribed by this section to the assessor-collector for the county in which the property described has been redeemed. The assessor-collector receiving the payment shall give the owner a signed receipt witnessed by two persons. The receipt, when recorded, is notice to all persons that the property described has been redeemed. The assessor-collector shall on demand pay the money received by the assessor-collector to the purchaser.
(g) In this section:
(1) "Land designated for agricultural use" means land for which an application for appraisal under Subchapter C or D, Chapter 23, has been finally approved.
(2) "Costs" includes:
(A) the amount reasonably spent by the purchaser for maintaining, preserving, and safekeeping the property, including the cost of:
(i) property insurance;
(ii) repairs or improvements required by a local ordinance or building code or by a lease of the property in effect on the date of the sale;
(iii) discharging a lien imposed by a municipality to secure expenses incurred by the municipality in remedying a health or safety hazard on the property;
(iv) dues or assessments for maintenance paid to a property owners' association under a recorded restrictive covenant to which the property is subject; and
(v) impact or standby fees imposed under the Local Government Code or Water Code and paid to a political subdivision; and
(B) if the purchaser is a taxing unit to which the property is bid off under Section 34.01, personnel and overhead costs reasonably incurred by the purchaser in connection with maintaining, preserving, safekeeping, managing, and reselling the property.
(3) "Purchaser" includes a taxing unit to which property is bid off under Section 34.01.
(4) "Residence homestead" has the meaning assigned by Section 11.13.
(h) The right of redemption does not grant or reserve in the former owner of the real property the right to the use or possession of the property, or to receive rents, income, or other benefits from the property while the right of redemption exists.
(i) The owner of property who is entitled to redeem the property under this section may request that the purchaser of the property, or the taxing unit to which the property was bid off, provide that owner a written itemization of all amounts spent by the purchaser or taxing unit in costs on the property. The owner must make the request in writing and send the request to the purchaser at the address shown for the purchaser in the purchaser's deed for the property, or to the business address of the collector for the taxing unit, as applicable. The purchaser or the collector shall itemize all amounts spent on the property in costs and deliver the itemization in writing to the owner not later than the 10th day after the date the written request is received. Delivery of the itemization to the owner may be made by depositing the document in the United States mail, postage prepaid, addressed to the owner at the address provided in the owner's written request. Only those amounts included in the itemization provided to the owner may be allowed as costs for purposes of redemption.
(j) A quitclaim deed to an owner redeeming property under this section is not notice of an unrecorded instrument. The grantee of a quitclaim deed and a successor or assign of the grantee may be a bona fide purchaser in good faith for value under recording laws.
(k) The inclusion of dues and assessments for maintenance paid to a property owners' association within the definition of "costs" under Subsection (g) may not be construed as:
(1) a waiver of any immunity to which a taxing unit may be entitled from a suit or from liability for those dues or assessments; or
(2) authority for a taxing unit to make an expenditure of public funds in violation of Section 50, 51, or 52(a), Article III, or Section 3, Article XI, Texas Constitution.
Amended by 1989 Tex. Laws, p. 3601, ch. 796, Sec. 33; amended by 1991 Tex. Laws, p. 1582, ch. 419, Sec. 1; amended by 1993 Tex. Laws, p. 1561, ch. 349, Sec. 1; amended by 1997 Tex. Laws, p. 2856, ch. 906, Sec. 11; by p. 2900, ch. 914, Sec. 4; and by p. 4247, ch. 1111, Secs. 6 and 8; amended by 1999 Tex. Laws, p. 5109, ch. 1481, Sec. 33; amended by 2001 Tex. Laws, p. 414, ch. 231, Sec. 1 and p. 4830, ch. 1430, Sec. 31; amended by HB 1125, 78th Tex. Leg., 2003, effective January 1, 2004; amended by HB 3419, 78th Tex. Leg., 2003, effective June 18, 2003.
Redemption authorized by constitution, see art. VIII, Sec. 13, Tex. Const.
Agricultural use defined, See Sec. 23.51.
Residence homestead defined, see Sec. 11.13.
Sale of property, see Sec. 34.01.
The September 13, 2003 amendments to Sections 13(c) and (d), Article VIII, of the Texas Constitution, take effect January 1, 2004, and apply only to the redemption of a mineral interest sold at a tax sale for which the purchaser's deed is filed for record on or after January 1, 2004. The redemption of a mineral interest sold at a tax sale for which the purchaser's deed is filed for record before January 1, 2004, is covered by the law in effect when the deed is filed, and the former law is continued in effect for that purpose.
A taxing unit must deposit all the excess proceeds from the sale of a tax foreclosed property into the registry to the court for proper disbursement to the property owner. This is true even if the property was first offered for sale two years (the redemption time period) before the actual sale of the foreclosed land. Syntax, Inc. v. Hall, 899 S.W.2d 189 (Tex. 1995).
Taxing units were not entitled to rescission of a deed acquired in full compliance with the Tax Code. Taxing authorities took a judgment on two tracts of land that were ultimately "struck off" to the entities. The owner redeemed the property. Then, it was discovered that an improvement was located on the land, and the taxing units attempted to rescind the redemption deed by claiming mistake. Whitehead v. Jasper County Water Control & Improvement District No. 1, 118 S.W.3d 485 (Tex. App.-Beaumont, 2003, pet. filed).
A property owner had two years to redeem foreclosed property if property was the owner's homestead. The owner could meet the homestead requirements under Section 11.13 by occupying the property as a principal residence or having the property owned through a beneficial interest in a qualifying trust by a trustor who qualified for the exemption. The legislative intent is to allow an owner who occupies a homestead an additional period of time to redeem that homestead. The mere failure to actually file an exemption application would deprive the owner of the right to redeem his homestead. Nichols v. Lincoln Trust Company, 8 S.W.3d 346 (Tex. App. - Amarillo 1999, no pet.).
Requiring authorization from all co-owners, when some co-owners are unknown, would make it impossible to redeem the entire property. Term "owner" in Property Tax Code Section 34.21 includes any person with an ownership interest in the property. The owner of an unknown undivided interest in the property could redeem the entire property. Rogers v. Yarborough, 923 S.W.2d 667 (Tex. App.-Tyler 1996).
A delinquent taxpayer's failure to correctly tender a full redemption payment or to even tender such a sum in good faith under the redemption statue bars any court ordered recovery of the foreclosed land. Therefore, the purchaser of the land at the redemption sale is entitled to actual possession of the land during the redemption period. Burkholder v. Klein Independent School District, 897 S.W.2d 417 (Tex. App.-Corpus Christi 1995, no writ).
The purchaser of property subject to redemption by the former owner is entitled to possession of the property during the redemption period under Sec. 34.21. Goggins v. Leo, 849 S.W.2d 373 (Tex. App.-Houston [14th Dist.] 1993, no writ).
A lien holder is entitled to be joined in a suit to foreclose property. Where the lien holder was not made a party to the suit, the trial court could properly award the redemption amount to the lien holder. Murphee Property Holdings v. Sunbelt Savings Association of Texas, 817 S.W.2d 850 (Tex. App.-Houston[1st Dist] 1991).
Statutes which provide for a right of redemption must be liberally construed. Buckholts v. Alsup, 56 S.W.2d 301 (Tex. Civ. App.-Texarkana 1932, writ ref'd); Macha v. Carameros, 674 S.W.2d 491 (Tex. App.-El Paso 1984, no writ).
A delinquent taxpayer whose property was sold to satisfy a judgment lien for nonpayment of taxes under the Texas Limited Sales, Excise and Use Act (prior to the adoption of the Property Tax Code) has no right to redeem the property in the absence of a statute or constitutional privilege. Wells v. Fenley, 668 S.W.2d 924 (Tex. App.-Amarillo 1984, writ dism'd w.o.j.).
The two-year period that begins with the filing of sheriff's deed provides reasonable time within which to pay delinquent taxes. Fender v. Moss, 629 S.W.2d 192 (Tex. App.-San Antonio 1982, writ ref'd n.r.e.).
(a) A person asserting ownership of real property sold for taxes is entitled to redeem the property if he had title to the property or he was in possession of the property in person or by tenant either at the time suit to foreclose the tax lien on the property was instituted or at the time the property was sold. A defect in the chain of title to the property does not defeat an offer to redeem.
(b) A person who establishes title to real property that is superior to the title of one who has previously redeemed the property is entitled to redeem the property during the redemption period by paying the amounts provided by law to the person who previously redeemed the property.
(a) If the owner of property sold for taxes to a taxing unit redeems the property before the property is resold, the taxing unit shall distribute the redemption proceeds in the manner that proceeds of the resale of property are distributed.
(b) Except as provided by Section 34.21(e), the owner of property sold for taxes to a taxing unit may not redeem the property from the taxing unit after the property has been resold.
Amended by 1997 Tex. Laws., p. 2857, ch. 906, Sec. 12.