The bill revises the foreclosure process for property tax lien holders, enhancing protections for property owners and their equity. Key changes include requiring payment for the sale to be completed before its conclusion, stipulating conditions for premium payments, and detailing the handling of funds if redemption is not made within five years. It allows property owners or their heirs to request a judicial sale or Internet auction to safeguard their equity, with established procedures and timelines for these requests. Additionally, the bill mandates that tax sale certificate holders notify property owners of their rights regarding foreclosure and potential sales, while clarifying the allocation of costs and attorney fees during the foreclosure process.

This legislation amends the tax sale law and the In Rem Tax Foreclosure Act to comply with the U.S. Supreme Court ruling in *Tyler v. Hennepin County, Minnesota*, which requires property owners to receive any remaining equity after a tax lien foreclosure. Property owners can demand a judicial sale or auction by submitting a written application to the court within 45 days of receiving a foreclosure complaint; otherwise, the foreclosure will proceed without such a sale. The bill also defines surplus funds from judicial sales and outlines the process for unclaimed funds after five years, directing them to the tax sale certificate holder or reverting them to the municipality if the holder is untraceable. The act will take effect immediately for foreclosure complaints filed on or after May 25, 2023.

Statutes affected:
Introduced: 54:5-97.1, 54:5-104.59, 54:5-104.64