The bill revises the process for property tax lien foreclosure, enhancing protections for property owners while balancing the interests of lien holders. Key amendments include requiring payment for the sale to be completed before its conclusion and extending the five-year redemption period if a property owner files for bankruptcy. Additionally, if a tax sale certificate is redeemed through a judicial sale or Internet auction within five years, the tax collector must refund the premium to the holder of the tax sale certificate, unless the holder is the successful bidder. The legislation also mandates that property owners or their heirs can request a judicial sale or auction to preserve equity within 45 days of receiving a foreclosure complaint, and it requires that foreclosure notices inform owners of their rights regarding these options.

Furthermore, the bill aligns with the U.S. Supreme Court decision in *Tyler v. Hennepin County, Minnesota*, affirming that property owners are entitled to any remaining equity after foreclosure. It clarifies that surplus funds from judicial sales will be available to property owners or their heirs, with unclaimed funds reverting to the municipality after five years. The act will take effect immediately for property tax lien foreclosure complaints filed on or after May 25, 2023, and will not impact any foreclosure actions with a final judgment entered prior to this date.

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