Asked in Tax Law, Family Law, Real Estate Law and Child Support for Maryland

Q: If a house is sold in a tax auction in Maryland, what happens to the liens on the house?

House was legally auctioned off at tax sale and the plaintiff is in the process of foreclosing the right to redemption. Current owner (defendant) of the house has no mortgage; the deed is in their name alone. This house/owner has a child support lien on it by the State of Maryland for over $30,000 in unpaid child support. There are other liens from the State of Maryland for unpaid state taxes and a Federal lien for unpaid federal taxes; all liens were placed long before the property tax auction sale. It looks like the owner will be losing the house. What happens to those liens now? What happens in regards to the child support lien?

2 Lawyer Answers
Cedulie Renee Laumann
Cedulie Renee Laumann
Answered
  • Crownsville, MD
  • Licensed in Maryland

A: Property tax liens tend to have super priority, meaning they stand first in line before most other kinds of liens. This means that in most cases, if proper notice is given, a tax sale foreclosure case wipes out the other liens and transfers the property free and clear of lesser liens.

That said, judgments are both PERSONAL obligations and LIENS against real estate in any county where the judgment is recorded. When a "priority" lien (such as a tax sale or mortgage) forecloses the foreclosure doesn't make other debts or judgments go away but it may remove them against the particular property that foreclosed. However, the judgment still can attach to other property even after foreclosure. If the person who owed money owns other property or later tries to buy a new property in the same county a valid judgment will usually automatically attach to the other real estate.

This general legal information does not offer advice or predict how the law might apply to your specific situation. For questions about child support in a specific case it would be prudent to reach out to the attorney or child support enforcement office handling that particular case and for questions about a specific tax sale one would want to look at the docket for that particular case.

While not legal advice I hope this general information helps answer the question.

1 user found this answer helpful

Mark Oakley
Mark Oakley
Answered
  • Rockville, MD
  • Licensed in Maryland

A: The tax lien sale wipes out all other liens except IRS federal tax liens. I am not sure about state income tax liens. Any excess bid that exceeds the tax lien payoff is then applied to any IRS lien (and state income taxes?). To the extent that the bid at the tax sale fails to cover an IRS tax lien, that lien is not wiped out, but remains attached to the property; however, there is a procedure with the IRS to address their lien rights (and again, not sure if state income tax liens survive as well). The prior owner who personally owed the money represented by the liens also remains personally liable for the debt, to the extent that the judgments on which the liens are based remain unexpired, or the debts (such as income taxes) remain collectible as personal debts against the original debtor. The new owner of the property does not personally owe any debts of the prior owner.

1 user found this answer helpful

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