The concept of the “right of redemption” applies to certain types of properties that have been foreclosed under certain situations. Texas law allows for an individual and in some scenarios, an entity such as a bank, to redeem a foreclosed property as long as certain steps have been taken. For tax foreclosures, the right of redemption depends on timing, payment of certain amounts and exercising your right to do so. Please note, in the event your purchase money lender forecloses on your property, you do not have any redemption rights under Texas law.

For residential single family homestead properties, after a tax foreclosure sale to an individual other than the taxing unit itself, the homeowner has the right to retake or “redeem” the property if he pays the buyer of the property (or any subsequent purchaser) the amount of the taxes, penalties, costs and interest paid by the purchaser, the amount of the deed recording fee, along with 125% of the aggregate total if the redemption occurs within the first year after the foreclosure and 150% of the aggregate total if the redemption occurs before the second year anniversary of the filing of the purchase’s deed.

If the taxing unit buys the property at foreclosure, then in order to redeem the property the owner must pay the taxing authority the lesser amount of the judgment or the market value of the property as specified in that judgment, plus the filing fee for the taxing unit’s deed and the amount spent by the taxing unit as costs on the property if the property was judicially foreclosed, or the lesser amount of the taxes, penalties, and costs for which the property warrant (A property warrant is issued by a court after a judgment is had against the owner for not paying taxes. The warrant directs sheriff to seize the property and sell it to satisfy the judgment) was issued or the market value of the property as specified in the property warrant plus the deed’s fling fee and the amount spent by the taxing authority as costs. There are certain specific ways to redeem residential properties that were designated for agricultural use at the time the warrant was filed. Progressive Realty Solutions, LLC suggests you contact a real estate attorney to discuss your legal rights concerning any right of redemption you may have.

If the owner of the real property sold at the tax sale other than a property used as the residence homestead of the owner, the owner may redeem the property in the manner allowed by a homestead owner, except the redemption period is only 180 days after the tax sale purchaser’s or the taxing unit’s deed is filed and the redemption premium percentage is only 25%. Under certain circumstances, the redeemer may redeem the property directly from the tax assessor if the purchaser cannot be found or if there is a disagreement as to the amount due to the purchaser by the redeemer.

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