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Properties Sold at Tax Sale in One Pennsylvania County Results in $2 Million Loss

A group of properties located in Montgomery County, Pennsylvania valued at almost $3.4 million were sold for less than a third of their value at the September 2009

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annual upset tax sale. According to a recent report by the ""Real Estate Tax Sale Law Network, Inc."":http://www.retslnetwork.com/ (RETSL), a servicer who connects lenders and property owners with legal experts who know the intricacies of real estate tax sale law, the properties sold for a total of $1,066,394, equaling only 31 percent of their value.

John Kelemen, EVP of RETSL, said this $2 million of value lost in only one of Pennsylvania's 67 counties is staggering and can represent a tremendous loss of capital to lenders and mortgage companies. He said the capital was lost for no other reason than a failure to respond to notices regarding delinquent property taxes, a lack of familiarity with the tax sale process, and the means of recourse available to those whose properties have been sold.

""These figures illustrate the potential significant losses lenders, investors or homeowners can experience when a property is exposed at tax sale,"" said Stephen M. Hladik, Esq., president of the RETSL. ""Pennsylvania, unlike many states, has no right of redemption. Unless timely objected to, these sales are final.""

As a result of the enormous losses during last year's tax sale, Hladik said RETSL will be tracking these sales to continue to provide investors and lenders with statistical data on the numbers and types of properties being sold. In addition, the network will also be putting out bulletins to alert lenders when sales are scheduled around the county.

""For further assistance to lenders and investors, RETSL will be posting information on important court decisions around the country affecting lien sales or tax sales,"" Hladik said. ""As such, RETSL is able to assist lenders and property owners find qualified legal representation for issues related to tax sales no matter the state.""

Established last year, RETSL is currently assembling a nationwide roster of attorneys and law firms. It expects to have members in all 50 states by April 1, 2010. Through RESLS's Web site, lenders, investors, and homeowners will be connected with skilled attorneys who are well-versed in the theory and practice of real estate law.

""There's no good reason why lenders should lose collateral at tax sales,"" Keleman said. ""Our growing roster of member firms is ready to provide the legal advice to prevent these properties from being lost or overturning sales if necessary.""

About Author: Brittany Dunn

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