Frequently Asked Questions on Treasurer’s Deeds
This FAQ is for individuals interested in tax liens here in Alamosa County. Should you have any additional questions please feel free to contact our office at: 719-589-3626: Monday through Friday 8:00 AM – 4:30 PM M.S.T.
What is a "tax lien"?
A tax lien is a lien (or a legal interest) on a given tax parcel issued by a taxing entity. The I.R.S. and state revenue agencies can place tax liens on parcels, but the county treasurer’s office (the county entity responsible for collecting property taxes can also place tax liens on parcels. The Alamosa County Treasurer holds a tax lien auction each year (around November) and any tax parcels which have unpaid/delinquent amounts will have tax liens sold against them. A bidder can offer to pay the remaining taxes, plus interest and fees then due on a parcel and in exchange, they will then hold a tax lien on that parcel until the owners pay off, or "redeem" the tax lien. During the time that the tax lien is held by the bidder, the bidder’s investment in the parcel accrues interest (which will be reimbursed to the bidder along with all the invested money upon redemption of the tax lien by the owner). This allows Alamosa County to operate and pay its entities the revenues that they are in need and expecting. It also allows investors to earn interest on their investment in Alamosa County.
When do I get paid back for my tax lien?
When the owner of the property pays off or “redeems” the tax lien. They then pay The Alamosa County Treasurer’s Office the total due in taxes, interest accrued and fees and the County Treasurer sends you a reimbursement check.
What does "P.T.L." mean, listed nest to certain parcels available in the next tax lien auction?
This is the designation we use in Alamosa County to indicate that there is a prior dated tax lien existing on a parcel at the time of a tax lien auction. Should you as a buyer see this, it simply means that an un-redeemed outstanding lien still exists on the parcel you may be bidding on.(See question above for more info).
Is there somewhere I can view parcels available for a pending tax lien auction?
All of the parcels that are delinquent as of early October will be published according to state statute three consecutive weeks in The Valley Courier newspaper. You will be able to view these parcels on-line to decide if there are parcels you may wish to bid on at the auction.
I got a letter saying that a parcel I hold a lien on also has another tax lien and that other lien holder is applying for treasurer’s deed. What do I do?
If you wish to retain your interest in the parcel, you have the right, as a senior (or prior dated) lien holder, to redeem, or pay off the tax lien of that other holder. This money is not money which will be refunded to you in the event of an owner redemption! Unfortunately, this is money due to this other tax lien holder and should you chose to redeem it to protect your interest, you are not entitled to have this money refunded to you should the actual owner of the property redeem your lien. If you wish to simply let the treasurer’s deed go through, and not protect your interest in the parcel, you would lose out on the money you had put into your own lien and waive any rights to be reimbursed for that lien.
I hold a tax lien on a parcel that has other older tax liens on it. How does this affect my ability to obtain a treasurer’s deed on the parcel?
In the event that there is / are senior (older) tax lien(s) on a parcel, you as a junior lien holder do NOT have to redeem out the senior lien holder to have a treasurer’s deed issued. You simply apply for deed and those lien holders will be notified accordingly that you have applied for deed. If they choose not to redeem your lien (to protect their interest in the parcel), then a deed will be issued to you and they will have waived their interest in the parcel.
I bought a tax lien at last year’s tax lien auction. I think I changed my mind, I don’t want it anymore. What can I do?
When you purchase a tax lien, all sales are final. We cannot refund your investment until it is paid back by the owner. Because of this, buying a tax lien is actually a three to four year commitment. Should you decide that you no longer wish to endorse a lien you hold, that is your choice, but we advise against it. This is because we will take the parcel back to tax auction and sell another tax lien on it. This other lien will put you as a senior lien holder - in direct competition for interest in the parcel. Should a second or third lien be sold, you still hold your lien until the owners redeem it, but should you wish to apply for a treasurer’s deed, you would then have other liens to pay off before we could issue a deed to you.
What is the interest / return rate on tax liens?
The rate varies from year to year, but it cannot be less than 8% per annum. It is typically 10%-15% per annum.
What happens if the owners never redeem the tax lien?
The redemption period for owners in Colorado is three years from the date of the sale of the tax lien. The holder of the tax lien can apply with the County Treasurer for a treasurer’s deed on the parcel when this redemption period is up. The treasurer’s deed process takes 5-6 months typically and costs $300-$500, but should no redemption of taxes take place, the tax lien holder will be issued a treasurer’s deed for the parcel – thus making them the owner. (More on this process below)
Why don’t you take partial payments for tax lien redemptions?
The payment to redeem a tax lien on a parcel must be made in full as we are not insured to hold money like a bank or lending institution. This amount must be paid in full so that we can immediately reimburse the tax lien holder and process the redemption.
I think I may owe back-taxes for a given year on a property I own. How do I find out if there is a tax lien on my property and how much do I owe to get it paid off?
For information like this we recommend you contact the Alamosa County Treasurer’s Office immediately to obtain a projected redemption figure that reflects current interest owed and all fees.
I have a parcel I have a tax lien on. Another investor is also holding a lien on the same parcel. How do I get rid of their lien so I am the sole lien holder?
If you are the senior lien holder you always have the right to redeem out a junior. Note that this redemption money is not going to be refunded to you if the owners redeem YOUR tax lien. You would simply be out this money to protect your lien. After all, the only way that this situation arose is because you neglected to endorse your tax lien in a subsequent year and we sound another lien on it. This does not work the other way around. If you are a junior lien holder you are not entitled to redeem a senior’s tax lien. You may, after the three year redemption period is up on your lien (and assuming that the senior has never applied for treasurer’s deed them self) apply for deed yourself and give the senior one last shot at redeeming you out. Should they choose not to, then they waive their interest in the parcel.
I got my endorsement list and sent money for the tax lien endorsements, but I waited a little too long to send it and you refunded me some money, saying that some of my endorsements were already paid by another tax lien holder on the same parcel. Is it too late for me to endorse these liens again this year? What does this mean for my interest I am earning?
If another tax lien exists on a parcel YOU currently hold a tax lien on, we will send an endorsement notice to BOTH lien holders because Alamosa County does not care who endorses taxes, they simply need to collect the tax revenue. In cases like this, we will accept the endorsement payment from whichever lien holder we receive payment from first on a given parcel. Every time you endorse taxes on a tax lien, you are increasing the amount you are earning interest on. So it is important to endorse as soon as we send out notices to you. (This is also why you don’t want there to be other tax liens on parcels you currently hold a lien on!)
You sent me the endorsement notice list you mentioned above, but it only had ___ number of parcels listed on it. I thought I held more liens with your county? Where are the others?
This endorsement list is only liens which you are eligible to endorse and have not been paid for the current year. The property owners may have actually paid the current years taxes due this year, but not redeemed the tax lien (i.e., the back taxes, interest and fees owed to you from the year of the tax lien). If they have not redeemed the actual tax lien, then you still hold that lien, but you may not have to pay the current year if the owners have paid it already.
What is a "Treasurer’s Deed"?
A treasurer’s deed is a deed issued by the County Treasurer of a given county that states that a buyer of a tax lien has been granted ownership of a parcel they held a tax lien on. The three year redemption period must have expired for the owner and all other requirements under the law must have been fulfilled. At the end of this process, should no tax lien redemption take place, the County Treasurer will issue a treasurer’s deed on the parcel to the tax lien holder – making them the owner of the parcel.
How long does the whole treasurer’s deed process take and what exactly is involved?
The entire process takes approximately five to six months. There are statutory obligations that we must meet in order to fulfill ‘due diligence” and rightfully issue a treasurers deed to you.
How long do I have to wait before I can apply for a deed?
In Colorado, you must hold the lien for three years. That is, we cannot issue you a deed until the lien has been held three years from the date of the sale. You can apply for a deed before that three year point, but we cannot issue you a deed until that time. It is our office policy that we send notice to you each year listing what liens are now eligible for deed. We will NOT send notice for any which became eligible in prior years and you have failed to apply for deeds on. If you hold liens on these older ones, you can still apply for deeds on them, but we will NOT be sending you "reminders" that you are eligible. Your list will only include those liens which will be three years old in November of that year. It is also our policy not to accept applications for deed unless the lien is already eligible (older than three years) or we are only approximately 5-6 months out from the date it becomes eligible. That is, you cannot apply for a deed right after buying the lien.
With treasurer’s deed applications, how much does it cost and what does that money pay for?
For real estate parcels, we ask for $500.00 for each parcel to cover all the legal fees, certified mailings, advertisements and current year taxes left unpaid in the process. If any of this money is NOT used, it will be returned to you with your deed. For mineral rights only parcels and mobile homes, we ask for $300 as the processing costs are less.
- We first send a "10 Day Letter" and a "Projected Redemption" amount to the owner of record. They have ten working days to pay the back taxes owed and not incur any additional costs.
- If there is no redemption, we order an "Ownership and Encumbrance Report" from a title company and this usually comes back to us within a few weeks. We use the information provided in the O & E to send certified mailings (an official "Notice of Sale of Real Estate/Mineral Rights") to individuals and entities of interest in the parcel, giving them one last opportunity to pay off back taxes.
- We also run three consecutive newspaper advertisements (the "Notice of Sale" above, one per week) as required by law when the value of the parcel is over $500.00. If the value is under $500, the step is not required.
- If we have sent out all official notices, run all required advertisements and waited the necessary amount of time(we schedule the deed date three months and one week from the date of the last publication date) - on that prescribed date, we will record a treasurers deed in your name with the Office of the Clerk and Recorder. At that point, you will be the owner of that parcel through a treasurer’s deed.
- Any of the $500/$300 fee you paid at the beginning which where not used in the process will be refunded to you at this point as well. In addition to the above costs there are fees for legal forms, recording fees to the Clerk and Recorder, notarization fees and other minor miscellaneous fees that your money is paying for. All expenses will be detailed for you in an expense worksheet included when we send your copy of the deed.
*PLEASE NOTE: We will not send any correspondence to owners, "warning letters", etc. before a deed application has been received and you have paid fees. It is our office policy that NO work will begin until we have received a signed application and fees. This is a legal document and must be filled out and signed correctly. We will provide assistance in filling it out, but we need a signed copy on file. You can request a blank form to photocopy yourself and use in the future applications, but please send an individual signed copy when you apply.
Why do you send the initial "10 day letter" if you send the certified letters later?
This is one of our office policies because we have found that often, if the owner receives it right away and we provide them with a solid redemption figure (unclouded by other fees and costs), that they will pay it immediately and it prevents many of the complications of refunding your money. This allows us to bring closure to the whole process in a more efficient manner.
How and when can I apply for "deed" on a tax lien I hold on a mobile home?
Mineral rights parcels can have treasurer’s deeds issued on them. Titled mobile homes have a different set of rules that govern the issuance of certificates of ownership (see below).For mineral rights and mobile homes we ask for $300 in deed expense fees. Unfortunately, in a very small number of instances, homeowners move property illegally. We cannot control this and as long as taxes are being assessed on a parcel in Alamosa County, we must assume that the property is still here and that a tax lien can be sold on it. Should it be discovered that a property has relocated illegally that you hold a tax lien on, you still hold the tax lien, but Alamosa County may not know where it is anymore and cannot be held responsible for such action on the owner’s part. CAVEAT EMPTOR or “Buyer Beware”.
- Is the mobile home located on leased land, not owned by the owner of the mobile home (i.e., in a mobile home park or leased land, etc.)? If so, then the redemption period is only one year from the date you purchased the tax lien.
- If the mobile home is located on private land -owned by the same owner as the title holder of the mobile home, they have the standard three year redemption period before you can apply for "deed".
We do not issue "deeds" on titled mobile homes. We would issue you as lien holder, a "Certificate of Ownership" on such mobile home property and this could then be used to show ownership to the Clerk and Recorder to have a title produced in your name. It is your responsibility as the new owner to have the title put into your own name upon issuance of a certificate of ownership. In order to have the transfer of ownership completed, you must still get a title made in your name – note that this takes place outside of this office. We merely issue the Certificate of Ownership to establish that you are eligible to be granted the title.
What can I do with the property once my treasurer’s deed is recorded and finalized?
Treasurer’s deeds in Colorado are non-merchantable titles. It is possible to sell a property obtained through a treasurer’s deed, but the terms and conditions under which you do so may be limited by the law. If you have questions regarding the legality of sale, under what terms, obtaining "quiet-title" on a property, or any other legal issues regarding the newly acquired property, please refer these questions to an attorney, real estate agent, Title Company or your own research as WE CANNOT PROVIDE LEGAL ADVICE IN THESE MATTERS.
We hope this FAQ has been enlightening and answered some of your questions regarding tax liens and treasurers deeds. Always feel free to contact our office with questions and we will be happy to assist you if we can!
I have older un-redeemed (active) tax liens with you county that I have been paying on for years. What about these liens?
We encourage you to apply for deeds on them right away! It should also be noted that according to Colorado law, we can, and do CANCEL any tax liens older than fifteen years, with or without notice.
I already paid my $500 fee, but you contacted me and told me that I need to send more money before you can issue me my deed, why?
It is our county’s policy to ask for $500.00 (for real estate and mobile homes) or $300.00 (for mineral rights only tax parcels) as this seems to be an amount sufficient to cover process costs and is often enough to cover any current year taxes which are due. It is our goal to find an amount of money that is a perfect balance of an amount convenient enough to allow you to start the deed without too much financial burden and, at the same time, cover all costs. We feel that the $500/$300 fees meet this goal. If we need to ask for more money to cover the treas. deed costs, we will try to do so as soon as it is discovered in order to issue you your deed quickly and without any further delay.
I went though this process before and it took longer than the five to six months you mention. Why is that?
Sometimes O &E’s take a long time to get back from title companies, sometimes there are legal issues that need to be sorted out with an attorney, sometimes we are just swamped with treasurer’s deed applications and we are a very small staff. Each of these steps takes time, labor and lots of organization to ensure that we are fulfilling our “due diligence” as required by law to notify those who need to be notified. There could be many reasons, but rest assured that we are working to issue you a deed in a timely manner. Please bear in mind that, while we are the entity which facilitates you getting your deed, our primary obligation is to the property owner and we need to make every effort to get them to pay their property taxes so they don’t lose the property in question.
I bought a tax lien at last year’s tax lien auction, when can I endorse / pay on it again?
We are obligated by law to allow the property owner to pay the taxes before we can allow you, the tax lien holder, to endorse taxes on the property in any given year. We prepare and send you a listing of parcels that you hold liens on (typically around August 1st of that year) with a total to re-endorse all taxes. Please remember that any tax amounts you endorse for subsequent years you earn you additional interest on in the event of redemption by the owner.
How and when do you conduct your tax lien auction on Alamosa County?
We hold an on-line auction for tax liens through a third party auction house. The company we are currently using is SRI, Inc. The auction is similar in many ways to an "E-Bay" style auction. We use a proxy bidding system. It takes place over a three day period in November. High bidders at the end of the auction win the tax liens on their parcels. Payment is due immediately and is done through an electronic transfer of funds from an account of the buyer’s choosing. Should there not be sufficient funds to cover the total payment, the buyer waives their right to the lien and the lien will not be granted to them. Registration takes place between September and November before the tax auction. Please contact our office for additional information on how to participate. All sales are final and it is the buyer’s responsibility to know exactly what they are bidding on. CAVEAT EMPTOR or "Buyer Beware". The mobile home parcels are covered in a separate sale that takes place in the form of a live auction – typically at the Alamosa County Treasurer’s Office on a given date in November. Contact us for more info.