Disclaimer: This article is for educational purposes only and does not constitute legal advice.
Detailed Answer
In Colorado, unpaid real property taxes trigger a county-held tax lien sale rather than an immediate foreclosure. The process follows these general steps under Colorado law:
1. Tax Delinquency and Lien Creation
Property taxes become delinquent if not paid by April 30 each year. At that point, the county treasurer declares a lien against the property for the unpaid taxes, interest, penalties, and costs (C.R.S. § 39-11-101 et seq.).
2. Tax Lien Sale
Each November or December, the treasurer advertises a public sale of tax liens. Buyers bid on the interest rate they will accept, starting at the statutory maximum of 9% per year (C.R.S. § 39-11-103). If you pay all delinquent amounts before the sale date, you stop the sale and clear the lien.
3. Redemption Period
After a lien sale, you have a two-year redemption window to pay the purchaser the lien amount plus interest and fees. Paying within this period prevents the purchaser from applying for a tax deed.
4. Tax Deed Application
If you do not redeem within two years, the lien purchaser may apply for a tax deed through the county clerk and recorder. Once the clerk issues the deed, you lose legal title and face eviction.
5. Protective Actions When You Cannot Pay
- Enter an installment plan. Colorado law allows partial payments on delinquent taxes. Contact your county treasurer early to request an installment agreement and avoid lien sale (see C.R.S. § 39-10-108).
- Apply for tax deferral programs. Homeowners aged 65 or older or those with permanent disabilities may defer payment until sale or transfer under C.R.S. § 39-10-109.
- Seek a hardship waiver. Some counties permit waivers of penalties or interest for documented financial hardship. Contact your treasurer’s office for local rules.
- Sell or refinance the property. A sale, refinance, or home equity loan can generate funds to pay delinquent taxes before sale.
- Consider bankruptcy protection. Filing for bankruptcy triggers an automatic stay that can pause foreclosure. Chapter 13 may allow you to include past taxes in your repayment plan. Consult an attorney to evaluate this option.
By combining early communication with your county treasurer, deferral programs, installment agreements, and alternative financing or legal strategies, you can protect your home from tax foreclosure.
Helpful Hints
- Mark the delinquency date (April 30) and the lien sale date in your calendar.
- Contact your county treasurer at the first sign of difficulty.
- Review eligibility for senior or disability deferrals each year.
- Keep thorough records of all payments and correspondence.
- Consult a qualified attorney if liens or tax deeds move forward despite your efforts.