Major Changes to Abandoned Property Law in Pennsylvania

In many areas of Pennsylvania, people live in homes where title to the property is not clear. Unclear title is especially prevalent in cities with older homes. Two examples are tenant-landlord relationships where the landlord disappeared or died and inheritance properties where the legal process was never completed.

Residents of a so-called “tangled title” property may face serious difficulties maintaining the property. Residents without clear title cannot obtain home improvement loans even when serious structural defects arise. If the property taxes fall behind, the local government will not offer owner-occupied payment plans to a person who does not have title. These properties often stagnant and become a blight on the surrounding neighborhood.

Pennsylvania has an existing abandoned property law known as “adverse possession” designed to settle title in unclear situations. The law is undergoing major revisions for residential properties starting June 2019. These changes will affect the rights of both property owners and residents of the properties.

Here are the upcoming requirements to bring a claim to re-title a property.

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How Does the Right of Redemption Impact Tax Sale Bidders and Former Owners?

A limited Right of Redemption is available for Philadelphia property owners whose property was sold at a tax sale. The sheriff will acknowledge and deliver a deed to the winning bidder after the full bid amount is paid. The winning bidder becomes the new owner with a caveat – the title is defeasible. This means the new owner must transfer the property back to the original owner if successfully redeemed.

 

 

Here are the requirements for the Right of Redemption under the Municipal Claims and Tax Liens Act:

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Common Pitfalls of Buying Tax Sale Properties

A property owner who fails to pay real estate taxes may lose the property to a sheriff’s auction. The sheriff will transfer the property to the winning bidder after full payment is made. The winning payment will be used to pay the taxes and possibly other liens depending upon the county in which the property is located.

 

Investors who purchase tax sale properties often acquire properties at a significant discount. However, there are many pitfalls to purchasing tax sale properties.

 

 

Below are seven common pitfalls of buying tax sale properties.

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