The biggest mistake new tax deed investors make: assuming the auction wipes every claim against the property. It doesn't. Some liens get extinguished. Others ride along with the deed — and you inherit them when you take title.
Liens that GET WIPED in a tax deed sale
- Junior mortgages — if they got proper notice, they're extinguished by the sale.
- Most judgment liens — most state-court money judgments are wiped if the lienholder was noticed.
- Mechanic's liens (in most cases) — depends on perfection and notice.
- Other tax liens of equal or junior priority.
Liens that SURVIVE a tax deed sale (these come with the property)
- IRS federal tax liens — these almost always survive. The IRS has a 120-day right of redemption after the sale; if they don't redeem within that window, the lien is technically extinguished, but practitioners know to wait the 120 days before treating it as gone.
- Other federal liens — Department of Justice criminal forfeiture, federal student loan judgments, etc.
- HOA / condo association liens — survive in most states and can total tens of thousands. Always check.
- Municipal liens — code enforcement, water, sewer, demolition liens often survive even when the underlying tax doesn't.
- Environmental liens — Superfund / EPA liens survive nearly everywhere.
- PACE / energy assessments — these are property-tax-style liens and survive.
How DeedFlex flags this
Every parcel on DeedFlex includes a lien-risk score that weights surviving liens against the opening bid. We flag known IRS liens, HOA arrears, and code-violation liens before you click bid. The Risk Score on the deal sheet shows you exactly what we found.
The right way to evaluate a deed before bidding
1. Pull the parcel record from the county appraiser. 2. Order a title abstract or pre-sale title search ($50–$200). 3. Check IRS records (Notice of Federal Tax Lien at the county clerk). 4. Check the HOA — call them, don't rely on the title report. 5. Check municipal records for code/lien notices. 6. Walk the property if you can.