When a property owner accumulates unpaid property taxes, the situation can quickly become concerning. If no action is taken, the municipality may ultimately proceed with the sale of the property to recover the amounts owed.
What is a sale for non-payment of property taxes?
A sale for non-payment of property taxes is the ultimate consequence of unpaid property taxes. When a property owner fails to settle outstanding amounts despite notices and granted deadlines, the municipality may initiate a process that leads to the sale of the property in order to recover the amounts owed, including interest and fees.
In Québec, this mechanism exists to ensure the collection of property taxes. The municipality acts as the creditor and typically transfers the file to the regional county municipality (RCM), which organizes the sale in accordance with the rules set out in the Municipal Code of Quebec.
How does a property tax sale work?
Tax payment default: when does the process begin?
The process begins when property taxes remain unpaid after the prescribed due dates. Outstanding amounts accumulate with interest, which can trigger the tax sale process.
Notice of sale for non-payment of property taxes
Before any sale takes place, notices are sent to the property owner to inform them of the situation. Public notices are also published. It is crucial not to ignore these communications.
Role of the RCM in a tax sale
Once the file is transferred by the municipality, the RCM takes charge of organizing the sale. It prepares the list of concerned properties and coordinates the public auction.
Timing of the sale and how the public auction works
The sale takes place on a date set by the RCM, often once per year. The property is sold at a public auction. The buyer is typically required to pay the amount due according to the established terms.
What happens during a tax sale auction?
For the buyer
The buyer acquires the property in exchange for payment of the outstanding taxes. However, ownership is not immediately definitive.
For the property owner
The property owner loses possession of the property but retains a statutory right of redemption as provided by law.
Can a property tax sale be cancelled?
Yes, in certain cases, a property tax sale can be cancelled. This may occur if the amounts owed are paid before the sale, if a procedural error is demonstrated, or if the owner exercises their right of redemption within the legal time limits. Time remains a key factor.
Learn More About Our Loan SolutionsWhat solutions are available before a sale occurs?
1. Contact the municipality quickly
As soon as the first notices are received, it is essential to contact the municipality to confirm the exact amount of unpaid taxes and determine whether a payment arrangement or agreement is possible.
2. Assess financing options
When finances are tighter, certain solutions may help property owners pay the taxes on time and avoid a sale, such as refinancing or using a private mortgage loan.
Contact us to learn more about your options.
FAQ
Timelines vary by municipality, but after several months of arrears, the tax sale process may be initiated.
No. The property is sold to recover the unpaid taxes, regardless of its market value.
Conclusion: act before it’s too late
A sale for unpaid property taxes is never inevitable. By acting quickly, communicating with the appropriate authorities, and assessing available financial solutions, it is often possible to avoid losing your property. The key is not to wait until the situation becomes irreversible.
Contact our team to explore the options that match your needs.
About the author
Co-President
Formerly a mortgage broker, Mr. McKinnon has been active in the mortgage lending industry for over 15 years. His strength lies in his ability to thoroughly assess client needs and provide tailored advice that delivers the most advantageous solution—short, medium, and long term. With extensive experience in private lending and over $500 million in notarized residential private mortgages, he stands out as Co-President of Lauréat Finance. His priority: delivering the best possible solutions efficiently and without delay.
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