Brought to you by Beltone – A leader in hearing healthcare.
The Yavapai County Treasurer’s Office would like to inform the public of the opportunities and risks involved in the tax lien certificate program (aka Tax Lien Auction). Yavapai County Treasurer, Chip Davis, said, “It is our goal to educate property owners on how to maintain ownership of their property.”
Please note all the matters detailed below are strictly governed by Arizona State Statutes and are not arbitrary policies of the Yavapai County Treasurer’s Department.
Tax lien auctions work the opposite of traditional auctions. When property owners fail to pay their taxes for two years, the tax lien goes to auction. The bidding starts at 16% interest, and competing bidders bid down to the lowest interest rate they are willing to accept.
This year’s Tax Lien Auction (2022) listed 1,870 properties with taxes due for two or more years. There were 1,457 tax liens sold and the remaining 413 properties are now available for over-the-counter sales at the statutory 16% interest rate.
These over-the-counter sales are an opportunity for citizens to make an investment that pays significantly higher rates than typical savings accounts. In order to purchase tax lien, the investor pays delinquent taxes and then receives 16% interest when property owner redeems. As is true for all investments, there are risks involved and investors need to perform their due diligence by researching each property prior to investing.
During this year’s auction, the Yavapai County Treasurer’s office reported an average interest rate of 3.38% and 56% of property tax liens sold at 0% interest. Investors generally purchase tax liens as an investment that pays interest. When investors purchase tax liens at a 0% interest rate, it is in anticipation of the property owner continuing in delinquency for the five years required for the investor to begin the foreclosure process and legally claim ownership of the property. The benefit to the property owner is that they can pay the lienholder the back taxes at 0% interest and maintain the property ownership. Although we do not allow bidders from outside the USA, many of the investors are from outside of Yavapai County.
For more information about tax liens and ways to maintain ownership of your property, please visit our website, yavapaiaz.gov/treasurer/treasurers-back-tax-sale. For more information about programs to freeze or reduce property taxes visit the Yavapai County Assessors website at: yavapaiaz.gov/assessor/forms.