Foreclosure

Everyone who owns real property in Durham County is required to list this property as of the first day of January of each year. Most times, this listing is automatic, but if there have been improvements or changes in the property, these must be reported by state law to the Tax Office with the listing forms in January. By July 1 of each year, a tax rate will be set by both the Durham County Commissioners and (if the property is within the Durham City limits) by the Durham City Council. For each parcel of taxable real estate, these tax rates will be multiplied by each parcel's listed and assessed valuation as of January 1 and the product of this multiplication is that year's tax bill on the parcel. Usually in August, but no later than September, a tax bill will be mailed out to the last known address of the taxpayer as of January 1, for that year. The taxpayer has until January 5th of the following year to pay the tax bill without penalty. After that time, if the bill remains unpaid, it becomes delinquent and subject to penalties and interest as set forth by state law. Once the property tax is delinquent, it is subject to foreclosure prosecution.

Under state law, the listing taxpayer is the responsible party for the taxes on property owned by the listing taxpayer as of January 1 of each year, even if the taxpayer sold the property after January 1. The Tax Office makes efforts to notify new owners of the existence of tax bills, but state law only requires that the tax bill be sent to the taxpayer as of January 1 of that year, and to the last known address of the taxpayer. It is the duty of each owner of property to keep the Tax Office notified of address changes and to know that taxes are payable each year, regardless of whether a billing was received.

When a tax bill becomes delinquent, the Tax Office tries various methods to notify the taxpayer and potential owners about the delinquent bill to see if the bill can be collected without the extreme remedy of foreclosure. Sometimes the Tax Office will set up a payment plan with a taxpayer, but the Tax Office is not required to do so, and can terminate payment plans at any time. The final step in the collection procedure is a pre-foreclosure letter sent by the Tax Office to the last known address of an owner and/or taxpayer. If these pre-foreclosure methods still fail, the Tax Office may assign parcels to private attorneys to commence foreclosure proceedings.

Once the Durham Tax Office assigns properties to attorneys to foreclose, the Tax Office marks its computer records with the assignment, and will no longer accept direct payments or payment plans from taxpayers. All tax payments from the point of assignment must pay the taxes, interest, fees and costs in full, and must be made through the attorney. Persons interested in paying off properties in foreclosure must contact the attorney directly to whom that property was assigned to secure a payoff quote. At some point after the assignment, the attorney will start a title search of the property to determine, as a matter of public record, all the owners, mortgage holders, judgment and lien holders, and other interested parties required by state law. The attorney will then prepare a complaint listing the City and County of Durham as the Plaintiffs (complaining parties). The Defendants will be all those parties found by the record title search to be interested parties in the real estate (owners, mortgage holders, etc.) The complaint will be filed in either Durham District or Durham Superior Court (depending on the amount of taxes owed). The summons and complaint will be delivered to each defendant by the sheriff, or by other approved means of service of process in civil lawsuits (FEDEX, certified mail, process server, etc.). Each party that is served is clearly informed by the summons that written answer, if any, must be filed with the Court within 30 days from the date the papers were served on the party.

There is no real defense to a property tax foreclosure complaint and lawsuit. The main purpose of the foreclosure process is to notify all interested parties that any legal interest they may have in the property will be terminated and extinguished if a tax foreclosure sale of the property is completed. This is because property tax liens are ahead of and superior to all other liens, except (in a limited extent) to filed income tax liens held by the North Carolina Department of Revenue. When a superior lien is foreclosed, it cuts off all junior liens and ownership rights.

As noted above, each defendant has 30 days to file a written answer to the complaint if they wish. Depending upon service on the parties and any answers filed, the attorney conducting the foreclosure will eventually move for a judgment of sale. Once a judgment of sale is entered, the property is scheduled for sale at the Durham County Judicial Building. Sales usually occur once a month. Notices of sale are published in the newspaper once a week for two weeks, posted at the Courthouse for at least 20 days, as well as being posted on the Durham County Tax Administration Website. The sale is conducted by a Commissioner appointed by the Court, usually Mr. R. Douglas Davis. At the sale, the highest successful bidder puts up a 10% cash/certified check deposit with the attorney, and the sale is reported to the Clerk of Court. After that, the sale stands open for 10 days for possible increased upset bids. Upset bids are calculated and received by the Clerk of Court for each property. If no upset bids are received, the attorney notifies the high bidder at the sale that the bidder has won, and that bidder has to come up with the balance of the purchase price. The process is the same when upset bids are received, except that the final high bidder after upset bids are completed is notified to bring in the purchase price of the final high upset bid. When the purchase price is paid under either sale process, the sale is confirmed and a Commissioner's deed is delivered to the new owner.

State law provides that any owner, mortgage holder or defendant in a filed tax foreclosure proceeding can stop the foreclosure process at any time by redeeming the property. The redemption price is equal to the taxes, interest, fees and costs of the foreclosure proceeding to the date of the redemption. Parties wishing to redeem property from tax foreclosure and stop the foreclosure process must contact the assigned attorney for a redemption payoff figure. Redemption can even occur after a sale, as long as the sale has not been confirmed by the Court. However, once the foreclosure property sale has been completed with a confirmation order and delivery of deed, all rights of redemption are terminated.

Bankruptcy proceedings filed by the property owner under federal law can also stop tax foreclosures, but all the taxes, interest, fees and costs of the action to the date of the bankruptcy filing must be paid as a priority claim in the bankruptcy proceeding.

Sales are held on the second Tuesday of every month at 12:00pm

The sales are held in the lobby of the Durham County Judicial Building, 510 Dillard Street (New Courthouse), Durham, North Carolina.

You do not have to register for the sale; however, you must be present to bid on a listing.

It is up to the individual to check the status of the property before bidding. Potential bidders should visit the property to determine if it will meet their needs. However, these properties do not belong to the County, and the County does not have access to, and cannot grant access to individuals who wish to enter the properties to check their status.

The sale is conducted by a Commissioner appointed by the Court, usually Mr. R. Douglas Davis. At the sale, the highest successful bidder puts up a 10% cash/certified check deposit with the attorney, and the sale is reported to the Clerk of Court. Since bidders may not have the exact amount of cash, or exact amount of certified funds with them, the attorney handling the foreclosure will allow the deposit to be made temporarily by personal check, to be held for a two-hour period. During the two-hour period, the winning bidder must secure and deliver to the attorney either cash or certified funds in the appropriate amount to replace the personal check.

The Commissioner will make it clear to all bidders present at the public sale that no representation or warranty of any kind is being made about the property or the status of title being delivered. Under state law, it is up to each bidder to carefully check out the title and status of the property being sold before placing either a public sale bid or an upset bid.

As a general rule, the properties will not be sold subject to any other liens, such as a mortgage. However, if the property is being sold subject to another lien, this will be announced by the Commissioner before bidding begins on the property.

Once the sale is complete, a 10-day upset bid period begins. For 10 calendar days, the sale stands open for possible increased upset bids. Upset bids of 5% or $750.00, whichever is greater, are received by the Clerk of court for each property. If an upset bid is filed, a new 10 day upset period begins. In this case, the attorney will contact the original bidder to let them know their bid was upset. Once no upset bids are received during a 10-day period, the attorney notifies the final high bidder that he/she has won, and that they must come up with the balance of the purchase price within three business days. When the purchase price is paid, the sale is confirmed and a Commissioner’s deed is delivered to the new owner.

The bidder will be in default and will be subject to immediate loss of all deposits, as well as subject to civil and/or contempt prosecution.

Properties that do not receive a bid will be brought back to sale the next month. After two appearances at sale with no bids, the property will go into the County’s surplus property. Instructions for obtaining property out of surplus can be found through our surplus link.

Properties listed are subject to redemption at any time prior to the entry of a confirmation order by the Court and delivery of a deed by the Commissioner. Efforts are made to update this website in a timely manner with redemptions and sale information but cannot be relied upon to be up-to-date in "real time". For the status of any property, the bidder is required to check the court file and/or with the attorney handling the sale.

Payment plans can be made for REAL Property tax bills only; however, this must be done prior to the bill becoming delinquent. Therefore, you can make payments without any formal payment agreement up until January 5th of each year. We recommend that you use our website that allows you to schedule payments to us on the 15th and 30th of each month.

Any taxes that were due at the time you filed bankruptcy are included in your plan (pre-petition). We can only make payment arrangements on current tax bills (post-petition). To make payment arrangements please contact our office at 919-560-0300.

No, but once your bankruptcy is completed or dismissed, all real property taxes must be paid in full to avoid further collection measures.

No, the option to sell tax liens was abolished by the legislature in 1983.

Motor vehicles is 5% interest the first month and 3/4% interest each month thereafter. Real and personal property 2% the first month and 3/4% interest each month thereafter.

Bankruptcy only covers the outstanding amount at the time you filed for bankruptcy. If you feel this is an error, please call our office at (919) 560-0300.

All property owners who have outstanding real property taxes owed in their name on the date taxes become delinquent will be advertised. Having a payment plan does not exclude your tax account from being advertised. A payment plan allows you time to pay your taxes without enforcement measures being used against you.

Once a levy has been turned over to a deputy sheriff, the delinquent taxes must be paid in full within the time frame provided by the deputy on the notice that was left at your residence.

The statutory deduction for a wage garnishment is 10% of the gross wages per pay period. However, some employers choose to take the full amount at one time.

Yes, payment must be made in cash, certified check, money order or credit card only. No personal checks can be accepted. Please ensure that your payment reaches the Tax Office on or before the effective date on the notice You will also need to contact our office notifying us of the payment so we can ensure that the release has been made on your bank account.

Yes, you can pay the tax bill in full to avoid the wage garnishment. You will be required to pay in cash, credit card, certified funds or money order. There is an additional processing fee for credit card payments.

The notice you have received is provided to taxpayers who may have recently purchased or acquired property. The notice provides an amount that remains outstanding on this parcel. If you have additional questions, please call our office at 919-560-0300.

If you are under a garnishment and our office is currently receiving payments for your delinquent taxes, you will be required to pay the bill in full to obtain your tag. The block must remain on the registration until the bill is paid in full. You can pay by using a credit card via our website or by coming into our office and paying by certified check, cash, money order or credit card. For all credit card transactions there will be a transaction fee added to your bill.

A bank attachment is a form of collection measures allowed by the NC General Statutes. It is served on your bank for outstanding taxes due. Your bank then places a hold on your accounts for ten (10) days or until they have been notified by the tax office that the debt has been paid in full. If your bill is not paid in full before the ten (10) day period ends, the bank is required by law to remit the amount of the attachment to the tax department.

The debt setoff is a form of enforcement in which the North Carolina Department of Revenue is notified of your debt and any refund due you will be attached to pay the bill. The state will also charge a fee of $5.00 as well as an administrative fee of $15.00.

The letter you received is a notification that your property tax bill remains unpaid. Your bill is subject to be turned over to the Sheriff's Office and your property may be seized and sold to satisfy your tax obligation. To avoid this action, you will need to pay the amount on the notice in full. You may pay by cash, certified check, money order or you may pay by credit card by going online or coming into the tax office. For credit card transactions there will be a transaction fee added to your bill.

Please visit our website at Payment Options.

Your bank charges a fee for processing an attachment. This fee is retained by your bank, and you will need to contact them for further information regarding this charge.

Once your tax account is turned over to a deputy sheriff for collection, fees are charged as allowed by the North Carolina Rules of Civil Procedure.

Any debt that is past due is subject to all enforcement measures. Please refer to the instruction sheet enclosed with your debt setoff letter. The hearing officer has indicated in the instruction sheet that this letter does not keep you from having other collection enforcement measures taken against you. The purpose of the letter is to allow you 30 days to object to the refund being attached. You must have a valid reason for an objection (such as: not your tax bill or never lived in Durham.)

Once your tax account becomes delinquent, the tax collector has the authority by State Statutes to use all enforcement measures including Sheriff's Levy executions to collect delinquent tax bills.

Once your tax account is turned over to an attorney firm for foreclosure, attorneys are authorized by State Statute to charge the fees and costs associated with the foreclosure process.

We are required by the State Statute to advertise all outstanding real property bills in the local newspaper. Taxes are advertised in the name of the person that owned the property on the date taxes became delinquent, January 6th of each year.

Your real property tax account became delinquent as of January 6th. The tax collector has the authority by State Statute to use all enforcement measures including foreclosure to collect delinquent tax bills after that date.

If you have listed Durham County Tax Collector as a creditor, your Bankruptcy plan will cover the bills prior to your filing date. If a bill comes out after the filing date it is the responsibility of the taxpayer to do one of the following:

1. Pay it or make payment arrangements.
2. Contact your attorney to have the post-petition bill included into your plan.
3. Call our office to check the timing on submitting an amended claim.