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SUPER LIENS OUTLIVE FORECLOSURES

Unpaid real estate property taxes never get “forgiven” or wiped out in a foreclosure.

They are super-liens that always have priority and stay attached to the property, no matter what.  In some jurisdictions in Georgia, water bills in the name of the property owner enjoy the same super-lien priority as property taxes.

If a buyer purchases a home and the title search does not uncover a super-lien before closing, then the title insurance company should cover those delinquent taxes – provided the buyer bought an owner’s title policy.

Ultimately, the previous owner is liable for those taxes. But in the case of a foreclosure or a short-sale, it is very unlikely that anyone would be able to collect those taxes from the previous owner. If they had been able to pay the taxes, they would have done so.

Investors who buy distressed properties will want to be sure to investigate the existence of an unpaid tax- or water-bill attached to the property.

Real estate agents who work with investors will enjoy working with a closing attorney who has seen the fall-out from incomplete title searches and can limit exposure to unpaid liens through a complete title search.

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