Information Regarding the Foreclosure Process

Statement Regarding Tax Foreclosures

Before foreclosing on a property we pursue every method available to us as collectors, including payment plans, wage garnishments, bank garnishments, and rent attachments. We give the owner ample opportunity to keep their property from being foreclosed upon; this is neither a decision we take lightly nor one we enter into hastily. We exhaust all possible options before we make the decision to foreclose. We want to help people keep their property, but when the delinquent taxpayer fails to make an honest effort to pay their taxes we realize that it is not fair to diligent taxpayers. Property tax dollars are used for funding fire departments, local parks, libraries, restaurant inspections, police officers, public schools, and other public services we use on a daily basis, so we take nonpayment of taxes very seriously. For more information about the Rutherford County budget, the services funded by your property taxes, and links to municipal web sites, visit http://cms6.revize.com/revize/rutherfordnc/departments/finance/budget_information.php.

 General Information Regarding Tax Foreclosures

Foreclosure Methods: We use two methods for foreclosure action; in-rem foreclosure is handled in our office by the paralegal and mortgage style foreclosure is handled by an outside attorney. N.C.G.S. 105-375 addresses our ability to use the in-rem method of foreclosure as well as the steps involved in the process. N.C.G.S. 105-374 addresses our ability to use the mortgage style of foreclosure as well as the steps involved in that process. This particular style is similar to how a bank foreclosure is handled.

Direct all inquires to the Tax Collection Specialist, Jennifer Whiteley at 828-287-6181 or jennifer.whiteley@rutherfordcountync.gov

How Does In Rem Tax Foreclosure Work? (Paralegal handles this foreclosure)

N.C.G.S. 105-375

  1. Property is assigned to the Tax Collection Paralegal for foreclosure.

  2. Courtesy letter is sent asking taxpayer to contact our Tax Collection Paralegal to prevent foreclosure.

  3. Tax Collection Paralegal works with taxpayer to collect taxes OR failure to respond results in moving forward with foreclosure action.

  4. Title search is completed.

  5. Tax Collection Paralegal visits the property/posts Notice of Docketing Tax Foreclosure Judgment.

  6. Certified letter mailed to owner(s), lienholders, judgment creditors, and any persons who may have a legal interest in the property.

  7. All parcels with unclaimed letters will have a Notice of Docketing Judgment advertised in The Daily Courier for the purpose of notification.

  8. Judgment for Delinquent Taxes is docketed with the Rutherford County Clerk of Court’s Office.

  9. 90 days after docketing the judgment, a Request of Execution is filed with the Rutherford County Clerk of Court.

  10. Order of Execution is signed by the Clerk of Court and the case is turned over to the Sheriff.

  11. A sale date is scheduled.

  12. Notice of Sale is mailed to owner(s), lienholders, judgment creditors, and any persons who may have a legal interest in the property.

  13. Notice of Sale is posted at the Rutherford County Courthouse in the Clerk of Court's Office and on the bulletin bord outside the Tax Collections office.

  14. Sheriff posts a Notice of Sale at the property.

  15. Notice of Sale is advertised in The Daily Courier.

  16. Ad is listed on www.rutherfordcountync.gov website, under the tax foreclosure link.

  17. Revenue Department prepares an opening bid for the taxes owed (this is a total of the taxes and foreclosure costs).

  18. Auction is held on the courthouse steps by a sheriff's deputy.

  19. Deputy reads the notice and opens the bidding for the minimum bid amount calculated by the tax office.

  20. Anyone present at the auction may bid the minimum amount or any higher amount. Amounts less than the minimum will not be considered.

  21. The high bidder on the day of auction must make a deposit of $750 or 5% of the high bid, whichever is greater, and must be paid with cash, certified funds, or money order at the end of the sale.

  22. Bidding is held open for 10 days for the filing of an upset bid with the Rutherford Co. Clerk of Court’s Office.

  23. All upset bids must raise the high bid by $750 or 5%, whichever is greater.

  24. It is the high bidders responsibility to keep a check on the status of his/her bid with the Rutherford Co. Clerk of Court's Office.

  25. The Tax Collection Specialist will mail out a Notice of Upset Bid and/or call number requested, but due to USPS you may not receive said notice before the expiration of the upset bidding, so a current phone number on file with us is very important.

  26. If your bid is upset, you can request a refund of your deposit from the Clerk of Court; or, you can raise the most current bid.

  27. Each time a new bid is placed, the upset bidding phase is extended for 10 more days.

  28. At the end of 10 consecutive days with no upset bidding, the Sheriff will request the clerk to sign an Order of Confirmation.

  29. The balance of the bid is due within 10 days to the Clerk of Court.

  30. Once funds are collected in full, a Sheriff’s Deed will be prepared in the name of the high bidder, and it will be recorded in the Rutherford Co. Register of Deeds Office. The deed will be forwarded to the new owner after the recording process is complete.

  31. Upon full payment of funds and the recordation of the Sheriff’s Deed, the Tax Collection Specialist will file a Cancellation of Judgment to close the case.

How Does Mortgage Style Foreclosure Work? (Attorney’s office handles this type of foreclosure)

Before referring a property to the attorney for foreclosure we exhaust all remedies available to us as collectors; for example, foreclosure warning notices sent to the taxpayer, wage garnishment, bank attachment, debt setoff, and/or payment arrangements. When none of those remedies are successful we forward to the attorney.

1. A demand letter for payment is sent to the taxpayer and any lienholders

2. A title search is done on the property

3. The complaint is filed with the Clerk of Court; this officially commences the action

4. Summons is issued and service is made on the parties by Sheriff’s deputy

5. If the parties to the summons cannot be located/served, notice of service will be advertised in The Daily Courier

6. Judgment is filed with the Rutherford County Clerk of Court requesting the sale of the property to satisfy the tax lien

7. If the defendant does not answer the judgment/fails to appear, the Rutherford County Clerk of Court will enter a judgment by default

8. If the taxpayer pays all of the taxes and fees before the conclusion of the suit, the action will be dismissed

9. Notice of sale will be advertised in The Daily Courier as well as on the website

10. A sign will be placed on the property to notify prospective bidders of the upcoming sale

11. Notice of Sale is mailed to owner(s), lienholders, judgment creditors, and any persons who may have a legal interest in the property

12. An opening bid is prepared for the taxes owed as well as any other costs, such as attorney fees and advertising fees

13. Auction is held on the courthouse steps by a trustee

14. Trustee reads the notice and opens the bidding

15. Anyone present at the auction may bid the minimum amount or a higher amount; no registration is required

16. The high bidder on the day of the auction must make a deposit of $750 or 5%, whichever is greater, and it must be paid with cash, certified funds, or money order

17. Bidding is held open for 10 days for the filing of an upset bid with the Rutherford County Clerk of Court’s Office

18. All upset bids must raise the current bid by $750 or 5%, whichever is greater

19. It is the high bidder’s responsibility to keep check on the status of his/her bid with the Rutherford County Clerk of Court’s Office

20. The Tax Collection Paralegal will mail out a Notice of Upset Bid and/or call the number requested, but due to USPS you may not receive said notice before the expiration of upset bidding so a current phone number on file with us is very important

21. If your bid is upset you can request a refund of your deposit with the Rutherford County Clerk of Court or you may raise your bid

22. Each time a new bid is placed, the upset bidding phase is extended for 10 more days

23. At the end of the upset bid period the balance of the bid is due

24. Once funds are collected in full, a deed is drafted transferring ownership into the high bidder’s name and will need to be recorded in the Rutherford County Register of Deed’s Office

25. Once the property sells, a report of sale will be filed with the clerk of court