Advanced Investor Resources

When we list a Featured Property, we work directly with the municipality to make sure that the information we are providing on OTS is accurate.  As part of this process, we check to see if there are aerial photos with ‘parcel fabric’ and street-level photos available for us to purchase.

‘Parcel fabric’ shows an aerial photo, taken by an airplane or satellite, with the property boundary lines superimposed on top of it.

If you are using photos other than those shown on OTS, we recommend that you crosscheck your information with a secondary source, if at all possible.

Google aerial maps do not show the boundary lines of a property, so they should only be used as a rough locator and a structure identifier (house, shed, detached garage).  Once you have identified that there are structures on the property, Google Street View might come in handy, if it is available in that area, to help identify the structures from the street. You might be able to use the zoom feature on the street views to locate an address on a house.

Will Google Maps always take you to the correct property? Not necessarily.  The Google system views a street as a single line. It knows the address at the beginning of that line and the address at the end of that line. In Geographic Information System (GIS) terms this is what is known as a Single Line Road Network (SLRN).

This single line is then evenly divided into sections, and those sections are evenly assigned with addresses. This works well if the houses on the street are evenly spaced apart from one another.  But if the houses are not evenly spaced, then you might not be shown the correct location for an address.

Be aware that the pictures of the same property shown on Google Street View and the aerial views on Google Maps might have been taken at different times; sometimes years apart from one another.  As a result, you may occasionally find that one of these pictures shows a vacant lot, but the other one shows a lot with a building on it.  That’s because in between the time that the two pictures were taken, a structure might have been built, or torn down.

Because of this possible time lag, you should cross-reference street views and aerial views with one another; don’t assume that you have correct information by looking at just one of them.

Google Maps are indeed a useful tool.  But be aware that they do not show property boundary lines.  Also, sometimes Google Maps or Google Street View may simply show the wrong property.  And, pictures of the same property seen from Google Maps and Google Street View may occasionally show different information, as the pictures might have been taken at different times.

The most common reason by far is that the property owner presented the municipality with a certified cheque or money order for the full amount of taxes owing, including costs and interest. The treasurer of the municipality accepted the payment and used his or her legal authority to cancel the tax sale.

For many years, most treasurers went by the following rule-of-thumb: they would accept payment in full only until they began advertising a property for tax sale. After that, they would not accept payment; they would proceed with the tax sale.

That changed a few years ago as a result of a court case called the Cunningham Case. 

As a result of this case, most municipalities will now accept payment in full at any time before a tax deed is registered. They will then cancel the tax sale. They do this because they don’t want to become involved in a court battle; they just want to collect the outstanding taxes.

As soon as a tax deed is registered it is impossible to cancel the tax sale. When your tax deed is registered the property becomes yours and neither the municipality nor the former owner can change that.

First, don’t order a Title Search Summary too far in advance. We suggest waiting 3 or 4 business days before the day of the tax sale to order a Title Search Summary. Second, if you have the highest tender, pay the full amount of money owing as soon as you possibly can.

If you order a Title Search Summary the day before a tax sale, we cannot guarantee that we’ll be able to get the search done and emailed to you on time. We will be able to get it to you on time if you order it at least two business days before the tax sale. For example, if you order a Title Search Summary on Monday for a tax sale that’s on Wednesday, we’ll email the search to you before Wednesday afternoon. We’ll try our best to get it to you on Tuesday, but can’t guarantee next day delivery.

If you have already submitted a tender, you might want to withdraw it. To withdraw a tender you must make a written request to do so, and that request must be received by the treasurer of the municipality before the date and time of the tax sale (usually 3:00 pm). A verbal request cannot be accepted. You can submit a written request by fax. If you do submit a request by fax, we recommend that you follow up the fax with a phone call to ensure that the treasurer has received your fax.

Yes, we get notified

Municipalities are supposed to notify us immediately when they cancel a tax sale, and they almost always do. We then mark it CANCELLED on the website and post on social media. We also make it impossible for people to order searches from us for that property.

Before you drive out to a municipality to attend an auction or tender opening, please check the website to make sure the sale hasn’t been cancelled!

Usually we are not notified

We recommend that you check with the municipality before you order a search. We recommend that you check with them again before you drive there to attend the tender opening or auction.

If we have not yet done the Title Search Summary or Title Search Update that you ordered, and we are notified that the tax sale has been cancelled, we will provide you with a full refund of the money you paid us for that search. If you order a search, and then want to cancel the order for any reason whatsoever, if we haven’t yet done the search we’ll be pleased to give you a full refund.

We do not provide refunds for InfoPaks or membership fees.

Once we have already done your search we will not provide a refund.

Remember, the sale can be cancelled at any time before the registration of a tax deed. So it’s in your own best interest to get the tax deed registered as soon as possible. To facilitate that, you need to pay the balance owing on your tender, plus Land Transfer Tax, HST and Accumulated Taxes, as soon as you possibly can. The municipality will advise you in writing of the exact amount that you must pay.

The above steps may help reduce the risk of you losing the money you’ve invested by investigating a tax sale, but they cannot eliminate the risk. Even if you do a search yourself at a land registry office, you will still have to pay for it, and the sale could still be cancelled.

There’s no getting around it. Until a tax deed has been registered, any tax sale can be cancelled. This is a risk that you must accept if you wish to participate in tax sales.

A tender with no name on it violates Rule 6(1)(a) of the Municipal Tax Sales Rules, which states:

6. (1)   A tender shall be in Form 7 and shall be,

(a)   typewritten or legibly handwritten in ink;

If the information that is required to be on Form 7 (the tender to purchase) isn’t there the tender will be rejected.

If a tender is submitted  for $50,001.00, . a deposit of at least $10,000.20 would be required; if the deposit is 20 cents short of the required amount the treasurer would be required to reject the tender. This requirement is set out in Rule 6(1)(b) of the Municipal Tax Sales Rules, as follows:

6.(1) A tender shall be in Form 7 and shall be,

(b) accompanied by a deposit of at least 20 per cent of the tender amount, which deposit shall be made by way of money order or by way of bank draft or cheque certified by a bank or trust corporation;

If the envelope is not sealed, this violates Rule 6(1)(c) of the Municipal Tax Sales Rules, as shown below:

6.(1) A tender shall be in Form 7 and shall be,

(c) submitted in a sealed envelope which indicates on it that it is a tax sale and provides a short description or municipal address of the land sufficient to permit the treasurer to identify the parcel of land to which the tender relates; The treasurer will be required to reject the tender.

A tender that is for less than the Minimum Tender Amount.has to be rejected, as it violates Rule 9(3)(a), as follows:

9.(3) After opening the sealed envelopes, the treasurer shall examine their contents and shall reject every tender that,

(a) is not equal to or greater than the minimum tender amount as shown in the advertisement;

How can you avoid having your tender rejected?

Every OTS InfoPak includes the following:

• Instructions for submitting a tender
• Checklist for submitting a valid tender
• Tender envelope

Before you submit your tender, read over all of the above items in the InfoPak.  And of course, carefully check and double-check your deposit, your Form 7 (the tender to purchase), and the tender envelope.

There are many ways to have your tender rejected.  You’ve now seen four recent examples.  Please, check your tender carefully!  It’s a shame to miss an opportunity to buy a tax sale property because your tender was rejected due to a technicality.

When you submit a tender for a tax sale property you cannot add any conditions or terms.  If you do, the municipality will be required by law to reject your tender, even if it’s the only tender that was received.  Your tender and your deposit will then be returned to you.

Tax sale properties are almost always advertised for prices well below market value.  However, these sales are strictly “no strings attached”.  You take the property exactly as is.  You cannot include any additional terms or conditions.

The deposit that accompanies your tender must be at least 20% of the amount of your tender.  If your deposit is less than 20% of the amount of your tender, even by a fraction of a cent, the treasurer of the municipality will be required to reject your tender, so you won’t be able to buy the property.  That’s the 20% Deposit Rule.

Take, for example, a tender submitted for $5,000.01.  20% of that amount is $1,000.002.  Of course, you can’t submit a deposit that includes a fraction of a cent.

If 20% of the amount of your tender comes out to a fraction of a cent, round it up to the next highest cent, do not round it down.   In order to comply with the 20% Deposit Rule in the above example, your deposit would have to be for at least $1,000.01.

You might find it hard to believe that your tender would be rejected over a fraction of a cent, but it is true.  The 20% Deposit Rule has been upheld by the courts.

A tender is a written document that states how much you will pay for the property.  A tender must be submitted on the prescribed form (called “Tender to Purchase” or “Form 7”). 

Your tender must be typewritten or legibly handwritten in ink.  If you use a pencil, or anything other than “typewritten or legibly handwritten in ink”, the treasurer will be required to reject your tender.

Only one property per tender, one property per deposit, one tender per envelope

If you wish to submit tenders for two properties, you must submit two completely separate tenders.  You must fill out two separate Form 7s (Form 7 is also known as “Tender to Purchase”) and have two separate deposit cheques or money orders.  Each Form 7, along with the deposit for that property, must be submitted in a separate envelope.  If you do not follow the Rule of One, the treasurer of the municipality will be required to reject your tender.

Tenders—What happens if my tender is not accepted?

If your tender is not accepted your cheque or bank draft will be mailed back to you a day or two after the day of the tender opening, along with an explanation of why the tender was not accepted.

Tenders—What if I submit a tender and then decide that I don’t want to buy the property?

Every tax sale by public tender has a deadline for receiving tenders.  That deadline is shown on OntarioTaxSales.ca.  

In order to have your tender withdrawn you must make a written request to the treasurer of the municipality to withdraw your tender, and your written request must be received by the treasurer before the deadline for receiving tenders.  If the treasurer receives your written request by that time, your tender will be withdrawn and your deposit will be returned to you.  If your written request is not received by that time, your tender cannot be withdrawn.

If you send your written request by any method other than delivering yourself, we recommend that you follow up with a phone call to make sure that the treasurer has received your request.

You cannot withdraw your tender after the deadline for receiving tenders has passed.

if two tenders are received for the same amount of money, the tender that was received first is deemed to be the higher.

There is a provision for it in the Municipal Tax Sales Rules.

Rule 7(1) of the Municipal Tax Sales Rules states:
On receiving an envelope identified as containing a tender, the treasurer shall mark on it the time and date on which it was received and shall retain it unopened in a safe place.

Rule 7(2) states:
For the purposes of this Part, where two or more tenders are equal, the tender that was received earlier shall be deemed to be the higher.

No, definitely not!  No matter how much you pay to buy the property at a tax sale, you will still have to deal with the Crown interest after you become the owner of the land.  The amount that you pay to buy the property has nothing whatsoever to do with the Crown interest.

No, you cannot.  If you submit a tender that contains such a condition, your tender will be rejected.  Also, it would be illegal for a municipality to use part of the money it receives from a tax sale to pay off a Crown interest.

You will be responsible to pay off that interest after you become the owner of the property.  If you do not pay off that interest, the Crown could seize the land you just bought and sell it.

You can withdraw your tender.  In order to do this you have to provide the treasurer of the municipality with a written request to withdraw your tender.  The request must be received by the treasurer before 3:00 pm local time on the last date for receiving tender.  If the request is not received by that time your tender cannot be withdrawn.

You will have to have a title search and an execution search done.

A Crown interest is any interest in favour of Canada or in favour of Ontario.  Here are some examples:

Canada Revenue Agency

Revenue Canada

Income Tax Act

Retail Sales Tax Act

Minister of Finance

Her Majesty The Queen

His Majesty The King

Business Development Bank

Federal Business Development Bank

Farm Credit Corporation

This is not a complete list.  There are many other types of Crown interests.

Not necessarily.  It depends on the value of the property, how much you are willing to pay for the property, and the amount of money owing under the Crown interest.

For example, if you are of the opinion that a property is worth about $100,000, and you are going to submit a tender for, say, $50,000, and there is a $10,000 Crown interest, this could be a worthwhile investment.  After you have bought the property, then paid off the Crown interest, you will still have obtained the property for quite a bit less than market value.

On the other hand, if you are of the opinion that a property is worth about $100,000, and there is a $150,000 Crown interest, this is probably not a very good investment.

They are required by the provincial legislation, namely the Municipal Act, 2001, that governs how municipalities operate. 

The existence of a crown interest does not necessarily mean that a property is not a viable investment.  For example, a property might have an assessed value of $200,000, and be subject to a $10,000 Crown lien.  It might be worthwhile to buy the property and pay off the crown lien.

The municipality is often unaware of crown interests encumbering property, as it is only required to search title when starting the process with the registration of a tax arrears certificate. By the time the tax sale is held, one to two years or more may have elapsed and there may be new registrations on title the municipality would not be aware of. Further more, every tax sale ad says:

“Except as follows, the municipality makes no representation regarding the title to or any other matters relating to the land(s) to be sold.  Responsibility for ascertaining these matters rests with the potential purchasers.”

If you decide to submit a tender and search title and executions after you receive notice that you will become owner upon payment of the balance owing, you will forfeit your deposit if you decide to not go ahead with the deal.  If you do go ahead with the deal and pay the balance on a property with crown interests, you will have all the benefits and responsibilities of property ownership – until the crown seizes and/or sells your land noting, of course, that it is unlikely you will ever be able to mortgage or sell land with a crown interest unless you pay it off.

Here’s a frequently asked question: If I look at a Treasurer’s Statutory Declaration Regarding Sending of Notice, will that show me if there are any Crown interests on the property?

Some people may be tempted to look at this declaration instead of doing a title search. Sometimes a treasurer’s statutory declaration will show if there are any Crown interests, and sometimes it won’t.

There are two issues with these statutory declarations that need to be considered. First, the fact that if there’s a federal Crown interest registered against the land, the treasurer does not have to send them a first notice or a final notice. Therefore, the federal Crown interest will not be shown on either of the statutory declarations.

Second, the first notices must be sent to parties who had an interest in the land on the day that the tax arrears certificate was registered. If the federal or provincial Crown registered an interest any time after that day, they would not have to be sent a first notice nor a final notice, and therefore they would not be shown on the treasurer’s statutory declaration.

Buying a tax sale property could be a good investment. But you should never, ever buy a tax sale property without first having obtained an up to date title search and execution search.

An execution is a judgment issued by a court of law against a person or a corporation and filed with the local sheriff’s office. The execution states that the person or corporation owes a certain amount of money to another party (the “Execution Creditor”). Often, the Execution Creditor is the “Crown”, for example, the Minister of National Revenue or the Minister of Finance.

It is vitally important to find out if there are any executions in favour of the Crown against the owner of a tax sale property.  If there are, and you buy the property, the Crown will almost certainly demand that you pay the money that is owing under those executions.

Please note that the Crown could not come after you personally to pay off the execution.  They could not, for example, sue you, garnishee your wages, or seize money from your bank account.  What they could do is seize the property that you just bought and sell it.

If the Execution Creditor is not the “Crown”, the execution will not affect the property after the tax sale, so you do not have to be concerned with it.

In order to find out if there are any executions against the owner of a property it is necessary to conduct an execution search for that county, region or regional municipality that the property is located in. You can have an execution search done by a lawyer, or a title searching firm, or you can go to a sheriff’s office or land registry office and conduct the search yourself.  You can also get an up-to-date execution search from OntarioTaxSales.ca..

An execution is a judgement issued by a court of law against a party ( “party” meaning a person, or a company, etc.) and filed with the local Sheriff’s Office. The execution states that the party owes a certain amount of money to another party (the “Execution Creditor”). Sometimes, the Execution Creditor is the “Crown”, for example, the Minister of National Revenue or the Minister of Finance.

An execution will not show up on a title search, as a title search deals with records of land, not with records of people or companies.

However, if a party has an execution registered against them, under certain circumstances the Land Registry Office will enter the words, “Subject to execution number ——, if enforceable” on the legal description of the property.

An execution authorizes the Sheriff (on instructions from the creditor) to seize the party’s property and sell it to recover the debt.  When the Sheriff seizes and sells the property, he or she is “enforcing” the execution.

 If the execution expires or gets paid off, the execution is not enforceable but the Land Registry Office does not know this has happened unless someone makes an application to remove the execution from title.

It is vitally important to find out if there are any executions in favour of the Crown against the owner of a tax sale property.  If there are, and you buy the property, the Crown will almost certainly demand that you pay the money that is owing under those executions.  Executions that are not in favour of the Crown will not affect the property after a tax sale, so you don’t have to be concerned with them.

In order to find out if there are any executions against the owner of a property it is necessary to conduct an execution search for that county, region or regional municipality that the property is located in. You can have an execution search done by a lawyer, or a title searching firm, or you can go to a Sheriff’s Office or Land Registry Office and conduct the search yourself.  You can also get an up-to-date execution search from OntarioTaxSales.ca,.

If you buy a Title Search Summary from OntarioTaxSales.ca it will include an execution search and details of any executions, in plain English, not legal jargon.  It will also let you know if an execution is in favour of the Crown.

Sometimes the answer to an interest such as a spousal interest or a beneficiary’s interest is buried away in the file of the lawyer who was acting for the purchaser at the time. Sometimes the answer was registered in the “General Register” rather than on title and the conversion team didn’t see it. At any rate, such interests are often not of concern to a purchaser in a tax sale.

Pursuant to section 379(7) of the Municipal Act, 2001, a tax deed conveys title free from all estates and interests except for:

(a) easements and restrictive covenants that run with the land;

(b) any estates and interests of the Crown in right of Canada or in right of Ontario other than an estate or interest acquired by the Crown in right of Ontario because of an escheat or forfeiture under the Business Corporations Act or the Corporations Act;

(c) any interest or title acquired by adverse possession by abutting landowners before the registration of the tax deed. 2001, c. 25, s. 379 (7); 2006, c. 32, Sched. A, s. 156 (3).

Unless the interest is one in (a) (b) or (c), it ceases to affect the title after a tax deed is registered. The above excerpt from the Municipal Act is included in the tax deed giving the Land Titles Registrar the authority to remove the interest from title if it is an interest wiped out by the tax sale. You may find that some Land Registrars will automatically remove the S/T from the description upon certification of the tax deed if it is clearly to be wiped out, while others will require a lawyer’s statement in an application to remove it. If the interest does pertain to one of the exceptions, it will continue to affect the property after the tax sale and will not be removed from title.

There is no requirement on the part of the municipality to correct the title or clear it up. The tax sale ad says ” the municipality makes no representation regarding the title to or any other matters relating to the land to be sold. Responsibility for ascertaining these matters rests with the potential purchasers.” Tax sale titles must be accepted “as is” and any “clearing up” becomes the responsibility of the new owner.

7. Mortgages—After a tax sale what happens to existing mortgages?

Mortgages that are registered against a property before a tax sale can be broken down into two categories: those that will affect the property after a tax sale, and those that will not affect the property after the tax sale.

Here’s a description of mortgages in each category.

When a property is sold at tax sale, any mortgages on it are eliminated, except for mortgages in favour of the “Crown”.  The “Crown” meaning the government of Ontario or the government of Canada, or one of their agencies or crown corporations.For example, the Business Development Bank is a Crown corporation.  Therefore, a mortgage in favour of Business Development Bank is a mortgage in favour of the Crown.  Please note that a Business Development Bank mortgage is just one example of a mortgage in favour of the Crown; there are many others.

If you buy a tax sale property that is subject to a mortgage in favour of the Crown, and you do not pay the Crown the money that is owing on the mortgage, the Crown could foreclose or sell the property under power of sale.   Thus, you could lose the property that you just bought.

Please note that you cannot include money to pay off existing mortgages in your tender or bid.  The money from your tender or bid cannot be applied to any mortgages.

Any mortgage that is not in favour of the Crown will no longer affect the property after a tax sale.  For example, if there is a mortgage in favour of the Bank of Montreal, it will not affect the property after a tax sale.  The person or company who holds the mortgage will have no further claim against the property after the tax sale.

At least ten months before a property is advertised for tax sale, everyone who holds a mortgage on that property is sent a notice that the property is in tax arrears and that a tax sale will result if the taxes are not paid.  At least three months before the tax sale they are sent a final warning.  Thus, anyone who holds a mortgage is given ample opportunity to pay the taxes and thereby avoid a tax sale.

In order to find out if there are any Crown interests in a property it is necessary to obtain an up-to-date title search and execution search.  The search must then be analyzed to see if there are any mortgages or other interests in favour of the Crown.

8. Mortgages—Getting a mortgage to buy a tax sale property–BE CAREFUL!

If you’re counting on getting a mortgage to buy a tax sale property, talk to your bank manager before you even submit a tender.  Make sure that he or she knows that you can’t get a deed until after the municipality has been paid in full.  And of course, make sure that the bank manager is okay with that.

If you don’t pay the balance owing on your tender, plus Land Transfer Tax, Accumulated Taxes and HST (if applicable) within 14 days of the day that the municipality mails its notice to you, you will lose your deposit!

1. The property can be re-listed as a tax sale
2. The property can be transferred to the Town and sold as surplus property.
3. The Town can choose to do nothing with the property.

There are rules. If there were no bids, the Town has the option of taking title to (Vesting)  the property. For any tax sale that happened over 2 years ago, they can’t vest the property in their name. Their right to do so has expired. The Town has to decide if the property is worth taking title to. For example, If the owner didn’t pay his income tax and there is a huge federal crown lien, the Town probably wouldn’t want it because the federal lien will remain on title.

Once the property has been vested (title of the property has been transferred to the Town), they have to go to Council and declare the property as “surplus”. Once that is done they can offer the property for sale. They can use a real estate agent, or list it on their website, or use our “surplusproperty.ca” website to advertise it. They can choose what price they want to sell it for. The selling price can be market value.

No, they do not.

As soon as a tax deed is registered on title, the previous owners lose any claim that they had to the property.  They cannot re-claim the property, nor can they bring any legal action to recover the property if a tax deed has been properly prepared and registered on title.  This is because of subsections 383(1) and 383(2) of the Municipal Act.  The Municipal Act is the legislation that governs tax sales.  You can see the pertinent parts of this legislation by going to http://www.ontariotaxsales.ca/resources-for-you/

Please note however, that a tax sale can be cancelled at any time before a tax deed has been registered.

What’s the difference between a Sheriff’s sale and a tax sale?

A tax sale is a sale of land by a municipality to recover unpaid property taxes.  A tax sale cannot be held for any other reason.

A Sheriff’s sale could be held for other reasons, such as to recover money as a result of an unpaid lawsuit.  It could be the sale of land, or the sale of goods, or both.

The rules and procedures for a Sheriff’s sale are quite different from the rules and procedures for a tax sale.  However, we don’t have any expertise in Sheriff’s sales, so we can’t make any meaningful comparisons

Why doesn’t OntarioTaxSales.ca show Sheriff’s sales?

We have tremendous experience and expertise with tax sales, we have no experience or expertise whatsoever with Sheriff’s sales.  We prefer to limit ourselves to what we can do exceptionally well (tax sales), rather than branching out into areas where we have no experience or expertise.

This depends on a variety of factors.  Municipalities endeavor to register the tax deeds as soon as possible, but there are some factors that are beyond their control.  As a rule of thumb it generally takes between 5 to 14 days, but sometimes less and sometimes more. 

Section 23 of the Municipal Tax Sale Rules says
23.    As soon as possible after a successful purchaser is declared in a sale under the Act, the treasurer shall prepare and register the necessary documents in accordance with the Act. O. Reg. 181/03, s. 23.

Once the balance owing on the sale has been paid and the “Successful Purchaser” has been declared, the Successful Purchaser must fill out a direction as to how they wish to take title, providing information that includes the purchaser’s name, address for service and birth date. This information is forwarded to whoever is drafting the documents.

All documents can be prepared online. The document preparer, the purchaser and the municipality must sign an “Acknowledgement and Direction” in which the parties acknowledge the contents of the tax deed and direct the document preparer to register the tax deed electronically. The original signed documents do not have to be presented to the Land Titles office and much of the process can be done by fax or email, cutting down on the time it takes to complete the registration.  Once all the documents are signed and ready, the document preparer can send the tax deed electronically to the Land Titles computer/server, but it quickly detects that the party selling the property (the municipality) is not the same as the owner in its database.  The Land Registrar must manually override the system to permit the registration.  The Registrar usually wants to take a look at the document before they do this and depending on their workload and their familiarity with tax deeds, it can sometimes take another day or two for them to implement the override to allow registration of the deed.  

The amount of time all of this takes depends on the availability of the purchaser to sign the documents, their access to a printer, fax or and/or email, the time constraints on the Land Titles office and intervening weekends.

Yes, there are.  Typically, the spring and fall are the busiest times of the year for tax sales.  The winter is usually the slowest time of the year.  

During the winter, staff members in most departments are extremely busy preparing their next year’s budget.  Treasury Department staff members are also busy preparing for their fiscal year end and the municipality’s annual year-end audit.  Having tax sales at this time is not feasible for most municipalities.Also, many municipalities don’t want to have tax sales in the winter because it would be difficult for people to get to the properties, especially in northern Ontario.  In the summer, a lot of municipal staff members take their vacations in the summer.  As a result, many municipalities prefer to not have their tax sales in July or August, as they would have fewer people to handle the extra workload.

You can expect to see fewer tax sales in December, January and February.  Watch for the numbers to pick up again in March and April.

No, you cannot get your money back. In order to give you your money back, the Treasurer of the municipality would have to cancel the tax sale.  The tax sale would then have to be done over again.  This would cost the municipality a great deal of staff time and thousands of dollars in advertising costs and legal fees.  These additional costs would have to be added on to the Minimum Tender Amount.  Thus, the price would be higher than it was when the first tax sale was done.

Also, if no one bought the property, the municipality would lose all the money that it had spent on advertising and legal fees, as well all the money that was owed to it for unpaid taxes.  The purpose of a tax sale is for a municipality to recover money, not to lose even more money.

Cancelling the tax sale and providing a refund would set a dangerous precedent.  It would essentially be saying that if anyone is declared the highest tenderer or successful purchaser, and they then change their mind, they could get a refund.  This would undermine the entire tax sale process.

If you submit a tender and then change your mind, it’s possible to withdraw your tender and get your deposit back by making a written request to the Treasurer.  The Treasurer must receive your request before the deadline for receiving tenders.  After that deadline, you cannot withdraw your tender.  If you decide not to complete the sale, you will lose whatever money you have paid to the municipality.

Unfortunately, you do not have the right to enter onto a tax sale property and have a look around.  Nor can the municipality give you permission to do so.

That’s because the municipality doesn’t own the property.  The property is still owned by the person or company that is in tax arrears.  The ownership does not change until after the tax sale.

You can stand on the road or the sidewalk and look at the property.  If it is a waterfront property you can take a boat out and see the property from the water.  But you don’t have the right to walk onto the property.  If you knock on the door and ask if you can have a look around, you’ll probably get a most unfriendly response.

If there’s a house on the property the municipality usually does not have information on how many bedrooms there are, if the basement is finished, etc.

At a tax sale, there’s less information available than there is at a normal sale of land.  However, tax sale properties are usually available for prices well below market value. Some people are willing to buy a property, even though there is less information available than they would like, because of the low price.

Tax sales in Ontario must be conducted either by public auction or by public tender.  It is up to the treasurer of the municipality to decide which of these methods will be used.  More than ninety percent of all tax sales in Ontario are done by public tender.  Here’s a brief description and comparison of the two methods of tax sale.

Tax sales by public auction

These are straightforward.  A date, time and location for the auction are specified in the advertisement for tax sale that is published by the municipality.  Each property has a minimum sale price, called the Minimum Bid Amount.  A bid for less than that amount cannot be accepted.

The auction is conducted out loud—it is not a ‘silent auction’.  If someone calls out a bid, someone else can call out a higher bid.

Whoever has the highest bid for a property must immediately pay the full amount of their bid, plus Land Transfer Tax, Accumulated Taxes, and HST (if HST is applicable).  This must be paid by either cash, money order, or a cheque certified by a bank or trust company.  If, for example, you went to an auction with a certified cheque for $10,000.00, and then bought a property for $9,000.00, the municipality would most likely write you a cheque for the difference.

It’s important to note that if you use a cheque that’s certified by a credit union, the municipality might reject it and you will not be able to buy the property.

For more detailed information on tax sales by public auction go to http://www.ontariotaxsales.ca/how-to-buy#buying-by-auction

Tax sales by public tender

At a tax sale by public tender, you state in writing how much money you are prepared to pay for a property.  This is called a tender (not a bid).  This must be submitted on a form called FORM 7 TENDER TO PURCHASE.

Your tender must be accompanied by a deposit.  The deposit must be equal to at least twenty percent of the amount of money that you have stated on FORM 7 that you will pay for the property.  This deposit must be made by way of a money order or a cheque certified by a bank or trust company.  Again, if you use a cheque that’s certified by a credit union, it might be rejected.  Your tender will returned to you and you will not be able to buy the property.

FORM 7 and your deposit must be submitted in an envelope that meets certain requirements.  If any of these requirements are not met, you will not be able to buy the property.

The date, time and location for the tender opening is specified in the advertisement for tax sale that is published by the municipality.  Your tender must be received at the specified location, on or before the specified date and time.  If your tender is received late it cannot be accepted.

When a municipality receives a tender it keeps it in a safe place, unopened.  All the tenders are opened shortly after the time shown in the advertisement.

If you have the highest tender, you will be notified by mail that you have 14 days to complete the purchase, and if you do not complete the purchase within that time, you will lose your deposit.

For more detailed information on tax sales by public tender go to http://www.ontariotaxsales.ca/how-to-buy#buying-by-tender

The biggest difference between tax sales by public auction and tax sales by public tender is that at a public auction, if someone calls out a bid, you can call out a higher bid.  At a public tender, you can’t increase the amount of your tender.  Once the time for accepting tenders has passed, no further tenders can be accepted.  And tenders are not opened until after the time for accepting tenders has passed.

FORM 7 is easy to fill out.  InfoPaks that are available from OntarioTaxSales.ca include a FORM 7, as well as the information that must appear on the envelope that you submit your tender in.  Our InfoPaks also include instructions on how to properly fill out and submit a tender so that your tender won’t be rejected because of a technicality.

An amendment made in 2006 to the Municipal Tax Sale Rules as legislated under the Municipal Act, 2001 permits the treasurer to postpone a tax sale, that has been advertised, if the treasurer is of the opinion that to complete the sale would be impractical or unfair to the bidders or tenderers (see Municipal Tax Sale Rule number 22).

The rescheduled tax sale must take place within 90 days of the originally advertised date or else the tax arrears certificate registered on title to the property must be cancelled and the tax registration/sale process begun all over again.

If a tax sale is “postponed” it must state this in the tax sale ad.  This is different than the re-advertising of an unsuccessful sale, where the ad does not have to state that it was previously advertised and may be re-advertised for sale within two years of the original unsuccessful sale.