Selling a House With Delinquent Property Taxes in Alabama
Yes, you can sell an Alabama house with back property taxes. The taxes, interest and fees are paid out of the sale at closing. Alabama property taxes are due October 1 and delinquent after December 31. If they stay unpaid, the county sells the tax debt at a public tax sale, either selling the property subject to your right to redeem or selling a tax lien, depending on the county. You generally have three years from the sale to redeem, and interest keeps running the whole time. Selling before or during that window is how you keep your equity.
Reviewed by Dennis Fassett, founder of Dennis Buys Houses · Updated November 2026
This guide is for Alabama owners and heirs who are behind on property taxes. It's general information, not legal advice. Each county's revenue commissioner or tax collector runs its own sale, so call yours first.
How Alabama Property Taxes Go Delinquent
- 1October 1
Property taxes for the year are due.
- 2After December 31
Unpaid taxes are delinquent. Penalties and interest start. In Mobile County, for example, unpaid accounts accrue 12% a year, compounded daily. (Mobile County Revenue Commission – Tax Sale Questions)
- 3Notice and advertising
The county notifies the owner and advertises the delinquent properties.
- 4The tax sale
A public auction, in person at the courthouse or online, depending on the county.
- 5Redemption
Generally three years from the sale to redeem by paying what the buyer paid, plus interest and costs. (Ala. Code § 40-10-120)
Call the County First
Depending on the county, property taxes are collected by the revenue commissioner, the tax collector or the license commissioner. Ask what's owed, which years are unpaid, whether the property has already been sold at a tax sale, who bought it, and what the redemption amount is today. If it hasn't sold yet, ask how long you have before the next sale.
Two Kinds of Alabama Tax Sales
Alabama counties can run their tax sales one of two ways, and it matters for what happens next.
The Traditional Tax Sale
The buyer pays the delinquent taxes and costs, and can bid more than that. Redemption interest is 8% a year on what the buyer paid, plus part of any excess bid, and on taxes the buyer pays later. (Ala. Code § 40-10-122) After three years, the buyer can seek a tax deed and possession, and redemption gets much harder.
The Tax Lien Auction
Some counties sell tax liens instead. Bidders compete on the interest rate, starting at 12% a year and bidding down. The lienholder doesn't take possession during the first three years and can move toward foreclosure only after that period, with notice to you. Mobile County, for example, gives owners three years to redeem through its office. (Mobile County Revenue Commission – Tax Sale Questions)
A tax sale isn't the end in Alabama. You usually have three years to redeem, but the payoff grows every month, and after that window the buyer's rights get much stronger.
Want a Number to Compare Against?
Tell me what's owed and about the house. I'll give you a straight as-is number so you can compare selling against paying it off, and tell you if catching up makes more sense.
Redeeming After a Tax Sale
The owner, the owner's heirs or personal representative, a mortgage holder, or anyone else with an interest can redeem within three years from the sale. A recorded mortgage holder gets at least a year from written notice of the sale. (Ala. Code § 40-10-120) Redemption is handled through the probate judge or the county's revenue office, depending on the county and the type of sale.
Who Has the House in the Meantime
Under a tax lien sale, the lienholder doesn't take possession during the three-year period. Under the traditional system, the tax sale buyer has stronger possession rights, but still can't change the locks on someone living there; they'd have to go through the court. Either way, stay current on what's owed and don't assume nothing is happening because nobody has knocked on the door.
Excess Bids: Money That May Be Yours
When a tax sale bid is more than the taxes and costs, the extra is held by the county. An owner who redeems can claim it within three years. After three years and up to 10 years after the sale, the owner at the time of the sale can also claim it by signing a recorded release giving up the right to redeem. (Ala. Code § 40-10-28) Unclaimed money eventually goes to the county, so don't leave it sitting.
Keep It or Sell It
Keep It
If you live there and can catch up, redeem or pay the taxes and get current. Ask about the homestead exemption and any senior or disability exemptions that lower your bill.
Sell It
If you can't carry the taxes, or the house is vacant or inherited, selling pays off the taxes or the redemption amount at closing and keeps the rest of the equity in your pocket.
If the house needs work, an as-is sale can close before the redemption window gets tight. The simplest way out is an as-is sale to a real estate investor: nobody tours the house, nothing gets repaired or hauled away, and the closing date is yours to set. That's a Dennis Buys Houses promise, not fine print. Keep what you want and walk away from the rest. If we find anything that looks personal or valuable while we're clearing it, we'll make sure it gets back to you.
A Tax Sale Shows Up on the Title
Once a property has been sold for taxes, any buyer's title company will want the redemption completed or a release from the tax sale buyer at closing. That's routine, but it takes time, so start early. A buyer who has handled tax sale redemptions before can make it much smoother.
Inherited House With Back Taxes
Taxes don't stop when the owner dies, and heirs are often the last to find out. Heirs and the personal representative are among the people who can redeem. Confirm who has authority to act, find out whether the property has already been sold, and keep the redemption window in front of you. (See How to Sell a House in Probate in Alabama and Selling an Inherited House in Alabama.)
Tax Sale vs. Mortgage Foreclosure
A tax sale is separate from a mortgage foreclosure. If you have a mortgage with an escrow account, the servicer usually pays the taxes. If you're behind on both, the mortgage is usually the faster problem. (See Selling a House in Foreclosure in Alabama.)
Common Mistakes
- Ignoring mail from the revenue office or probate court.
- Assuming a tax sale means the house is already gone.
- Letting the three-year redemption window run out.
- Not knowing whether your county sells liens or the property itself.
- Leaving excess bid money unclaimed.
- Letting taxes pile up while an estate is open.
Where I Fit, and Where I Don't
I help most when the house has already gone to a tax sale or one is coming, it needs repairs, it's vacant or inherited, or you want it settled.
You won't have to clear the house out for Dennis Buys Houses, either. Leave anything you don't want, and we'll take care of it.
If you live there and can catch up or redeem, that's usually the better move, and I'll tell you so.
Whichever side of that line you're on, you'll hear it from me upfront.
Frequently Asked Questions
Yes. The back taxes, interest and fees, or the redemption amount, are paid out of the sale at closing.
They're due October 1 and delinquent after December 31.
Generally three years from the date of the sale.
No. With an as-is sale, you can take what matters to you and leave the rest. Dennis Buys Houses handles what's left.
The amount a tax sale bidder paid above the taxes and costs. The owner can claim it by redeeming within three years, or later by signing a release.
Usually yes, during the redemption period. The redemption is paid at closing.
Call the revenue commissioner or tax collector in your county. Mobile County Revenue Commission – Tax Sale Questions is a good example of how one county explains it. The key statutes are Ala. Code § 40-10-120 (redemption) and Ala. Code § 40-10-28 (excess funds).
Alabama Selling Guides
- How to Sell a House in Probate in Alabama
- Selling an Inherited House in Alabama
- Selling a Vacant House in Alabama
- Selling a House With Bad Tenants in Alabama
- Selling a House in Foreclosure in Alabama
Behind on Taxes and Not Sure What to Do?
Tell me what's owed and where it stands. I'll give you a straight as-is number, and if redeeming or catching up is the better answer, I'll tell you.