How tax delinquent property sales work in Alabama

When a property owner in Alabama stops paying property taxes, the county tax assessor's office eventually sells the property at a public auction to recover the unpaid taxes. This auction happens at the courthouse steps (or sometimes online now, depending on the county). You can bid on these properties with cash, and if you win, you own the property — but the original owner has a window of time to reclaim it by paying back taxes plus costs.

The process is not the same as a foreclosure sale. You are buying the tax lien or the property itself, depending on the stage of delinquency and the county's process. Alabama uses what is called a tax deed sale system, meaning the winning bidder receives a deed to the property, not just a lien. However, the original owner can still redeem the property within a set period after the sale.

This is a cash transaction. You cannot use a mortgage to buy at a tax sale in Alabama. You must bring certified funds or a cashier's check to the auction, and payment is due immediately or within a very short window — usually the same day or within 24 hours.

Key Takeaways

  • Tax delinquent properties in Alabama are sold at public auction by the county tax assessor, typically at the courthouse, and you must pay in cash on the day of the sale.
  • The original owner has a redemption period (usually one to three years, depending on the county and circumstances) to reclaim the property by paying back taxes, interest, and costs to you.
  • You receive a tax deed, but your ownership is not final until the redemption period expires and no one redeems the property.
  • Before bidding, you must research the property's title, liens, and condition yourself — the county does not warrant the property or clear the title.
  • Each county in Alabama runs its own tax sale process, so timing, notification rules, and redemption periods vary by location.

Finding tax delinquent properties for sale in Alabama

The county tax assessor's office publishes a list of properties scheduled for tax sale. You can find this list by contacting the tax assessor's office in the county where you want to buy. Most counties now post the list online on their website or on a state-level portal. The list typically includes the property address, the amount of back taxes owed, and the sale date.

Alabama also has a statewide tax sale website where some counties post their sales, though not all counties use it. Calling the tax assessor directly is often faster than searching online. Ask for the tax sale list and the date of the next auction in that county. Sales happen on a set schedule — some counties hold them monthly, others quarterly or annually.

You can also hire a title company or a tax deed investor service to monitor sales for you, but you will pay a fee for that service. If you are buying multiple properties or in multiple counties, this can save time, but it is not necessary.

What you must do before you bid

Do your own title search and property inspection. The county does not may provide the title or the condition of the property. You could win the auction and discover the property has a senior lien, environmental problems, or structural damage. The county's job is to collect taxes, not to verify that you are making a sound purchase.

Visit the property in person if possible. Look at the building, the land, and the neighborhood. Check for signs of occupancy, damage, or hazards. Talk to neighbors if you can. A property that looks cheap at auction might be cheap for a reason.

Search the property records at the county courthouse or online. Look for liens, judgments, code violations, or other claims against the property. A title company can do this for you, but it costs money. At minimum, search the tax assessor's records to confirm the back taxes owed and any other tax liens.

Understand the redemption period for that county. This is critical. If the original owner redeems the property, you lose it and get your money back — but you have held the property and received no return. Redemption periods in Alabama range from one to three years depending on the county and the type of property.

The redemption period and what it means for your ownership

After you win the auction and receive your tax deed, the original owner (or sometimes a lienholder or other party) can reclaim the property by paying you the full amount you paid at auction, plus interest and costs, within the redemption period. This period is set by Alabama law and varies by county — it is typically one to three years.

During the redemption period, you own the deed, but your ownership is not final. You can rent the property, make repairs, or hold it, but you cannot sell it with a clear title. Most title companies will not insure a property during redemption. If the property is redeemed, you receive your money back, but you have lost the time and any money you spent on repairs or maintenance.

After the redemption period expires with no redemption, your ownership becomes absolute and you can sell the property or refinance it. At that point, you can obtain title insurance and a clear deed.

Bidding at the tax sale auction

Auctions in Alabama are typically held at the courthouse steps or, increasingly, online through a county-designated platform. You must register before the sale, and registration usually requires proof of funds — a bank statement or a letter from your bank showing you have the cash available.

Bidding usually starts at the amount of back taxes owed, plus costs and interest. If multiple people bid, the price goes up. The highest bidder wins. You must pay immediately or within 24 hours, depending on the county's rules. Payment is by certified check or cashier's check — personal checks are not accepted.

If you win, you receive a tax deed certificate at the sale. This is not the final deed; it is proof that you won the auction. The county will issue the actual deed after the redemption period expires (or sooner if the original owner redeems and you receive your money back).

Costs and fees you will pay

The purchase price at auction is only the beginning. You will also pay:

  • Back taxes, interest, and penalties: These are included in the opening bid amount and are part of what you pay.
  • County auction fees: Some counties charge a buyer's premium or registration fee, usually a small percentage of the purchase price.
  • Title search and insurance: You should pay for a title search before you bid (to avoid surprises) and title insurance after redemption expires (to protect your ownership). This typically costs $300 to $1,000 depending on the property value.
  • Property taxes after the sale: Once you own the property, you are responsible for property taxes going forward.
  • Repairs and maintenance: If the property is damaged or needs work, you pay for it.
  • Legal fees: If you need an attorney to handle the deed transfer or resolve title issues, you pay those costs.

The total cost of buying a tax delinquent property is often much higher than the auction price alone. Budget for these additional expenses before you bid.

Risks and common problems

The property may be occupied. If someone is living in the property, you cannot simply evict them after you win the auction. You must follow Alabama's eviction process, which takes time and money. Some tax sale properties are occupied by the original owner or a tenant, and removing them is your responsibility and expense.

The property may have environmental or code violations. If the building violates local codes or has environmental contamination, you inherit those problems. The city or county can require you to fix them, and you pay for the repairs.

The original owner may redeem. You could hold the property for years and then lose it when the original owner pays off the redemption amount. You get your money back, but you have lost time and any improvements you made.

The title may be clouded. Even after redemption expires, there may be liens or claims you did not discover before the sale. Title insurance protects you against some of these, but not all. A thorough title search before you bid is your best defense.

The property may be worth less than you paid. If you overbid at auction, you could end up owing more than the property is worth. This is especially true if the redemption period is long and the original owner redeems — you get your money back, but you have wasted time and opportunity.

Frequently Asked Questions

How long does it take to get a clear deed after I win the auction?

It depends on the redemption period for your county, which ranges from one to three years in Alabama. After that period expires with no redemption, the county will issue your final deed. If the original owner redeems before that, you receive your money back immediately, but you do not own the property.

Can I get a mortgage to buy a tax delinquent property?

No. Tax sales in Alabama are cash-only auctions. You must bring certified funds to the sale. After the redemption period expires and you have a clear deed, you can refinance or take out a mortgage on the property.

What if I cannot attend the auction in person?

Many Alabama counties now offer online bidding for tax sales. Contact the county tax assessor to ask if online bidding is available. If not, you can hire a representative or a tax deed service to bid on your behalf, but you will pay a fee.

Do I have to pay property taxes on a tax delinquent property before the redemption period ends?

Yes. Once you own the deed, you are responsible for all property taxes going forward. If you do not pay, the property can be sold again for taxes. Some investors factor this into their decision to hold the property during redemption.

What happens if the property is worth less than what I paid at auction?

You own the property and are responsible for it. You can sell it, rent it, or hold it, but you cannot recover your money from the county. This is why researching the property and the market before you bid is critical.