Three bills that affect tax sale investors are pending in the Alabama legislature. Two might pass. One is hopefully only a boogie man, mean to frighten the big out-of-state investors. The two that might pass are SB218 and SB362. SB218 would eliminate interest accrual on excess bids, effective January 1, 2016. In other words, if a property owner owes $1,000 in taxes, and the auction bids goes up to $10,000, then only $1,000 of the bill will earn interest. The other $9,000 will not earn any interest as all. Sponsors of this bill are Senators Pittman (Baldwin County), Holley (Pike, Coffee, Dale, Covington), Whatley (Tallapossa, Russell, Lee), Sanford (Madison), McClendon (Talladega, St. Clair and Shelby), Singleton (Tuscaloosa, Sumter, Pickens, Marengo, Clarke, Choctaw, Greene and Hale) and Ross (Montgomery). SB362 would reduce the redemption interest rate from 12% to 7.5% effective January 1, 2016. It was sponsored by Senator Pittman (Baldwin County) The deadliest of the three is SB53, sponsored by Senators Pittman (Baldwin county) and Whatley (Tallapoosa, Russell and Lee counties), would reduce redemption interest rate to 1% per year, retroactively! I hope the retroactive interest rate reduction to 1% per year is a mere political ploy, meant to scare the "big investors" and keep them out of Alabama, at least this year. If it passes, it will be the death of tax sale investing in this state.
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