Do I Get Any Ownership Interest in Real Property by Paying Property Tax in New Hampshire?
Disclaimer: This article is for informational purposes only and does not constitute legal advice. Consult a licensed attorney for advice regarding your specific situation.
Detailed Answer
Paying property taxes on real estate does not automatically give you an ownership interest in the property under New Hampshire law. Instead, payment of taxes creates a tax lien in favor of the municipality that levied the tax. A tax lien is a claim on the owner’s property for unpaid taxes, interest, and penalties. It does not transfer title or equitable ownership to the taxpayer.
Under New Hampshire Revised Statutes Annotated (RSA) Chapter 80, the town or city holds a lien on the property when taxes become delinquent. If a property owner fails to pay taxes within the timeframe set by RSA 80:42, the governing municipality may initiate a tax deed process. Even if a third person pays the delinquent taxes, they secure the right to file a tax deed, but they do not become the legal owner until the municipality completes the foreclosure or tax deed sale process and issues a deed in their favor.
Key steps under RSA 80 include:
- Assessment and billing of property taxes by the municipality.
- Delinquency and accrual of interest under RSA 80:42 (RSA 80:42).
- Notice of intent to foreclose if taxes remain unpaid for two years.
- Filing of a tax deed application by the lienholder or municipality and issuance of a deed upon court approval.
Paying someone else’s taxes to protect your own financial interest (for example, if you hold an option or are in contract) can preserve the property from tax foreclosure, but it does not grant you title. To secure ownership, you must acquire the deed through a negotiated transaction with the owner, a successful bid at a tax deed sale, or a court-ordered foreclosure under RSA Chapter 80.
Helpful Hints
- Review RSA Chapter 80 to understand lien rights and redemption periods.
- Obtain a title search to identify existing mortgages, liens, and encumbrances.
- Consult the town or city tax collector’s office to verify delinquency dates and amounts.
- Consider title insurance if you plan to acquire property through a tax deed sale.
- Speak with a real estate attorney before participating in a tax deed auction.