Tax lien transfers provide relief to Texas property owners by offering an alternative method to paying their property tax bills in one lump sum. With the property owner’s consent, the tax lien transferee pays the owner’s delinquent property taxes directly to each taxing entity, which then transfers its tax lien to the transferee. The property owner is then responsible for making monthly payments to the transferee, with repayment terms ranging from two to ten years (at the owner’s discretion). Over the past three years, property tax lien transferees have assisted more than 47,000 property owners and have funded more than $500,000,000 in property taxes.
The industry is primarily governed by sections 32.06 and 32.065 of the Texas Tax Code, Chapter 351 of the Finance Code, and Title 7, Chapter 89 of the Texas Administrative Code. These sections cover the required disclosures, notices, and foreclosure process. They also regulate the requirements and conditions of when a transferee can pay the taxes on behalf of a property owner. For example, property owners may authorize a transferee to pay taxes on their behalf only if the taxes are delinquent at the time of payment or if a tax lien transfer has been previously perfected on the property.