Can I sell land with a lien or back taxes?
Yes. Land with a recorded lien or delinquent real estate taxes can still be sold. The tax lien comes first: it stands ahead of every other lien until actually paid, reaches the whole fee, and sale proceeds must be applied to it. A paid deed of trust is released of record by steps of its own, such as a certificate of satisfaction with the affidavit the statute requires.
The tax lien sits in front, and every recorded lien stands behind it
Before deciding anything about a sale, sort what is owed against the land into two groups, because they behave differently when the land changes hands: the real estate tax lien, and everything recorded behind it.
| Debt | How it attaches | Where the record is |
|---|---|---|
| Real estate taxes | A lien on the land for taxes assessed on it, ahead of any other lien or encumbrance until actually paid, reaching the entire fee simple estate | Liens of delinquent real estate taxes are recorded in the office of the treasurer |
| Deed of trust | Secures a loan against the land | The clerk of the circuit court where the land lies |
One phrase in that first row carries the weight. The statute puts the tax lien "prior to any other lien or encumbrance" until it is paid, and it reaches the whole fee, not only the interest of the person the tax was assessed to. The rest of the list, and other recorded items that make a buyer's examiner stop, are gathered in what a cloud on title is. A deed of trust and how it secures a loan has its own page.
Back taxes are paid from the proceeds, and a tax sale has its own clock
The statute that makes the tax lien first also tells the sale what to do with it: the purchaser at a sale must cause the proceeds to be applied to the taxes assessed on the land, and the seller's share of the taxes is prorated by the contract.
That makes two separate tax items at a closing. Delinquent taxes from past years are paid from the proceeds. The current year is divided between buyer and seller by proration, which is explained in how property taxes are prorated at closing. In Carroll County the amounts owed come from the Treasurer, 605-10 Pine St., Hillsville, (276) 730-3060, whose posted 2026 deadlines are June 24, 2026 for the first half and December 7, 2026 for the second half of real estate taxes.
The longer the taxes sit, the more a tax sale enters the decision. Generally, real estate may be sold for delinquent taxes once they are still delinquent on December 31 following the second anniversary of their due date. Shorter periods apply to listed conditions, such as a structure condemned by the local building official, and, on a court finding, to real estate assessed at $100,000 or less. The notice before suit must tell the taxpayer they may ask the treasurer for a payment agreement of up to 72 months. An owner, or the owner's heirs, devisees, successors and assigns, may redeem before the sale date by paying all taxes, penalties, interest, attorney fees and costs; partial payment does not redeem.
A lien paid at settlement still has to come off the record
Paying a recorded lien and releasing it are two events, and the gap between them is where a later buyer's title search finds an old deed of trust still standing.
Payment
After full or partial payment of a debt secured by a deed of trust, vendor's lien or other lien, the lien creditor must issue a certificate of satisfaction, or of partial satisfaction, in a form sufficient for recording.
Notice from the settlement agent
If the settlement agent has sent the creditor notice, the creditor provides the certificate to that settlement agent within 90 days after receiving it. If no such notice came, the creditor delivers the certificate to the clerk's office with the recording fee within 90 days after payment.
The penalty
Except as the statute provides for judgment lien creditors, a creditor that has done neither within 90 days after payment forfeits $500 to the obligor.
The release
Once the certificate is signed and the affidavit the statute requires is filed or recorded with it, the certificate operates as a release of the lien.
There is a second path when the settlement agent made the payoff. A settlement agent or title insurance company may then release a deed of trust or judgment lien by the statutory notice procedure, but only in purchases of, or loans on, unimproved real estate with a lien of $1 million or less, or real estate with one to four residential dwelling units. The title search and the policies written at a closing are covered in title insurance, explained.
Where a buyer instead takes land with a lien left on it, the grantor's tax is figured exclusive of the value of any lien or encumbrance remaining on the property at the time of the sale. Whether a lien should stay or be paid is not something the tax decides; that belongs to the contract and the parties' attorneys.
Listing land that owes money: the questions and the office that answers each
A lien does not stop an owner from listing. Whether a sale can clear what is owed turns on figures only certain offices can give.
| The question | Who answers it |
|---|---|
| What is owed on the deed of trust today | The settlement agent or an attorney, from the lender |
| How much in delinquent real estate taxes | The county treasurer; in Carroll County, (276) 730-3060 |
| Which lien is ahead of which on this parcel | The settlement agent or an attorney, from the title examination |
| Whether a judgment or mechanics' lien is still valid | An attorney |
| Whether a lien-release ordinance applies locally | The treasurer or the county attorney |
Heirs selling land with taxes behind face the same lien, and during a tax sale suit an individual who claims ownership by will or intestate succession may give the treasurer written notice of that claim, on which the treasurer may suspend the sale action; how heirs establish their right to sell is covered in selling inherited land. The paperwork a buyer's side asks for is gathered in the documents needed to sell land, and the terms used above are defined in the land sale glossary.
Selling a tract with a deed of trust or unpaid county taxes against it?
Send the county and the tract's location. Lowell can put an opinion of value on the land so you can see whether a sale clears what is owed, while the payoffs stay with the settlement agent. No cost, no obligation.
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Questions this raises
Does paying part of the delinquent taxes stop a tax sale?
No. Under Virginia's tax sale statute the owner may redeem the property at any time before the sale date by paying all accumulated taxes, penalties, reasonable attorney fees, interest and costs, and partial payment is not sufficient to redeem it.
Can someone buy part of a tract that owes back taxes?
Yes, and Virginia gives that buyer a way to separate the tax. A person who buys part of a tract may petition the circuit court of the county or city where the land lies to decide how much of the delinquent tax is properly chargeable to the part bought. The settlement agent or an attorney handles how that works in a specific sale.
If back taxes are not paid at closing, does the lien stay with the land?
Yes. Virginia makes real estate taxes a lien on the land ahead of any other lien or encumbrance, and it remains that prior lien until actual payment is made to the proper officer. The lien is not limited to the interest of the person the taxes were assessed to; it reaches the entire fee simple estate. How unpaid taxes are handled in a particular closing is for the settlement agent or an attorney.
Where this page's facts come from
Every rule, office and figure above traces to one of these. Rules change; check the office before you act on one.
- Va. Code 58.1-3340, lien on real estate for taxes, and application of sale proceeds Virginia General Assembly
- Va. Code 58.1-3344, tax lien on the entire fee simple estate Virginia General Assembly
- Va. Code 58.1-3930, delinquent tax liens recorded in the office of the treasurer Virginia General Assembly
- Va. Code 58.1-3965, sale of real estate for delinquent taxes, notice, payment agreements and redemption Virginia General Assembly
- Va. Code 58.1-3228, local ordinance releasing delinquent tax liens Virginia General Assembly
- Va. Code 58.1-3227, apportioning delinquent taxes to part of a tract Virginia General Assembly
- Va. Code 55.1-339, certificates of satisfaction and release of liens Virginia General Assembly
- Va. Code 58.1-802, grantor's tax Virginia General Assembly
- Treasurer Carroll County, Virginia