In-Rem Foreclosure of Tax Liens
Wisconsin State Law provides for the transferring title to land when taxes are delinquent. Oconto County utilizes the "In Rem" Foreclosure process, Ordinance O2021-02-01, of taking parcels by tax deed (State Statute Chapter 75.521).
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What Is “In Rem” Foreclosure?
Real estate taxes are secured by the real property upon which they are assessed by a tax lien. When property owners do not pay their real estate taxes, Wisconsin law permits counties to enforce the tax lien in order to collect the delinquent taxes.
On September 1st of each year, Oconto County issues a Tax Certificate for each parcel of real property for which there are unpaid taxes, interest, penalty, special assessments, and/or special charges as of August 31st. All owners of record receive notice of the issuance of the Tax Certificate.
If there are still unpaid taxes, interest, penalty, special assessments, and/or special charges two years after Tax Certificates are issued, the county can foreclose on the property. Oconto County uses a statutory procedure known as “In Rem” foreclosure. Section 75.521 of the Wisconsin Statutes contains all of the legal procedures and requirements for an in rem foreclosure action.
When an “In Rem” foreclosure action is filed, a List of all properties being foreclosed upon is filed with the Clerk of Court, along with a Petition for a Judgment of Foreclosure transferring legal title to each parcel in the list to Oconto County. Notice of the foreclosure action is sent to the last known address of all owners, lenders, and other persons, entities, or units of government with secured interests in the property. Notice is also sent to the municipalities in which properties are located. Notice of the foreclosure action and the list of properties are also published in the local newspapers for three (3) consecutive weeks.
Wisconsin law requires a redemption period of at least 8 weeks after the foreclosure action is first published. During the redemption period, any owner or interested party may “redeem” the property (that is, take it off of the foreclosure list) by paying the delinquent taxes along with any special assessments, special charges, interest, penalties and other additional charges that have accrued for the year of the Tax Certificate. There may be other charges that must be paid before a property is redeemed.
An attorney, known as a Guardian Ad Litem [GAL], is appointed by the court to determine if any party with an interest in a listed parcel may be incompetent or a minor.
Each party entitled to receive notice also has the right to file a written answer to the action. The kinds of defenses that can be raised and the time period during which an answer can be filed are limited by statute. IF YOU WOULD LIKE MORE SPECIFIC INFORMATION ABOUT FILING AN ANSWER, YOU WILL NEED TO CONSULT WITH AN ATTORNEY OR REVIEW APPLICABLE LAW. THE CORPORATION COUNSEL AND TREASURER CANNOT GIVE YOU LEGAL ADVICE.
After the redemption period has expired, a court hearing is held. Generally, a judgment of foreclosure will be granted by the court for every parcel that remains on the list at the time of the hearing. At that point in time, the county obtains complete ownership of the properties in the foreclosure list. With the exception of easements and mineral rights, all prior ownership interests, liens, secured interests, etc., are extinguished forever.