If you don’t pay property taxes in California, a 10% penalty is added the moment you miss a deadline, your property is declared tax-defaulted after June 30, interest then accrues at 18% per year, and after five years the county can sell your home at public auction to recover what’s owed.
The First Missed Deadline
California splits your annual secured property tax bill into two installments. The first is due November 1 and becomes delinquent at 5:00 p.m. on December 10. Miss it and a 10% penalty is added to the unpaid amount.1State of California. Property Tax Function Important Dates
The second installment is due February 1 and becomes delinquent at 5:00 p.m. on April 10. That triggers the same 10% penalty plus a $10 administrative cost.2California Legislative Information. California Code RTC – Section 2618 Paying only the first installment doesn’t spare you: the penalty still hits the unpaid half.
If any portion of the annual bill is still unpaid by June 30, the entire outstanding amount is declared in default at 12:01 a.m. on July 1. This happens automatically, by operation of law, with no hearing and no courtesy warning.3California Legislative Information. California Code RTC – Section 3436
Tax-Defaulted Status and the Five-Year Clock
Being tax-defaulted doesn’t mean you lose your home right away. You still own the property and can live in it. What changes is the math. Starting July 1 of the default year, interest accrues at 1.5% per month, or 18% annually, on the unpaid taxes.4Justia Law. California Code RTC – Chapter 1 Redemption Generally A statutory redemption fee of $15 per parcel is added as well.
From that July 1 date you have five years to redeem the property by paying everything owed: original taxes, penalties, accumulated interest, and the redemption fee. Pay in full within that window and the default clears. Miss it and the county gains legal authority to auction the home.
Paying Off Defaulted Taxes in Installments
You don’t have to come up with the full redemption amount at once. California law lets you set up a five-year installment plan on defaulted taxes.
- An initial payment of at least 20% of the redemption amount, plus accrued interest and a one-time setup fee that varies by county.
- Annual payments of at least 20% of the redemption amount plus accumulated interest, due by April 10 each year.
- Current-year property taxes, kept paid on time while the plan runs. Any supplemental bills also need to stay current.
As long as you stay current, the county cannot sell the property.5California State Controller’s Office. Information to Taxpayer Regarding an Installment Plan Miss any installment, or let current taxes slide past April 10, and the plan defaults. If the five-year sale window has already passed, you cannot start a new plan.6California Legislative Information. California Code RTC – Section 4217 For properties still inside the window, you can restart a plan beginning July 1 of the fiscal year after the default. Treat the plan like a mortgage payment you cannot miss.
Your Mortgage Lender Will Act Before the County Does
For most homeowners, the mortgage servicer is the faster threat. A property tax lien takes priority over a mortgage, which puts the lender’s collateral at risk the moment taxes go unpaid, and loan agreements almost always require you to keep taxes current.
What usually happens: the servicer monitors your tax status, advances the money to pay the delinquent taxes, and adds that amount to your loan balance. Fail to reimburse the servicer and that failure counts as a breach of the mortgage, which can trigger the same foreclosure process the lender would use if you stopped making monthly payments. Many California borrowers already have escrow (impound) accounts that collect property tax money with each mortgage payment. If you don’t have one and taxes go delinquent, expect the lender to step in quickly.
One thing that will not happen automatically: property tax delinquency alone doesn’t appear on your credit report. The major credit bureaus stopped including tax liens in reports in 2018. Lenders can still find a lien through public records, which can affect refinancing or new credit.
How the County Tax Sale Works
If you haven’t redeemed the property or kept an installment plan going, the tax collector can sell it at public auction after five years from the default date for residential property. For nonresidential commercial property, the timeline is three years, and properties with a recorded nuisance abatement lien can also be sold after three years at the lienholder’s request.7California Legislative Information. California Code RTC – Section 36918California State Controller’s Office. Chapter 7 Tax Sale FAQ Single-family homes, multifamily residences, residentially zoned land, and commercial agricultural land are excluded from that shorter window.
The Notice You Will Receive
Before the auction, the tax collector must send notice of the proposed sale by certified mail to your last known address, between 45 and 120 days before the sale date. The sale must also be published in a local newspaper three times at successive seven-day intervals, at least three weeks before the auction.9California State Controller’s Office. Tax Collector Reference Manual – Chapter 7
For owner-occupied homes, the tax collector must also make a reasonable effort to personally contact the owner-occupant between 10 and 120 days before the sale.
The Auction and the Last Chance to Redeem
The property goes to the highest bidder. The minimum bid equals the full redemption amount (defaulted taxes, delinquent penalties, interest, costs, and the redemption fee) plus any outstanding balance on a property tax postponement loan.10California Legislative Information. California Code RTC – Section 3698.5 You can still redeem the property up until the close of business on the last business day before the sale. After that moment, the right of redemption is gone.
If a property has already been offered once with no acceptable bids, the tax collector can lower the minimum price (with board of supervisors approval) based on current assessed value. The current owner cannot buy the property back at that reduced price.10California Legislative Information. California Code RTC – Section 3698.5
After the Sale: Eviction and Excess Proceeds
Once the auction closes, the buyer receives a tax deed and you lose all ownership rights. You can be legally evicted.
If the property sells for more than the total owed, the extra money is called excess proceeds. When those proceeds exceed $150, the county must notify you and any other parties with an interest in the property (mortgage lenders, lienholders) within 90 days of the sale. The county mails notice to each party’s last known address, or publishes it in a local newspaper if addresses can’t be found.11Justia Law. California Code RTC – Chapter 1.3 Distribution of Proceeds From Sale
Former owners and other interested parties have one year from the date the tax deed is recorded to file a claim for the excess proceeds.12California Legislative Information. California Code RTC – Section 4676 The board of supervisors reviews the claims and distributes funds no sooner than one year after the deed is recorded. If your home sold for substantially more than the tax debt, you could be owed a significant payout, but you have to actively file a claim. The county won’t send a check unprompted.
Challenging a Completed Sale
A finished tax sale is not always the end. The board of supervisors can rescind a sale if the property should not have been sold, for example because proper notice wasn’t given or the taxes had actually been paid.13California Legislative Information. California Code RTC – Section 3731
The deadlines are strict. You must petition the board within one year of the tax deed’s execution. If the board denies your petition, you then have one more year from that denial to file suit in court.14California Legislative Information. California Code RTC – Section 3725 Miss either deadline and the sale stands regardless of your grounds.
Bankruptcy
Filing for bankruptcy triggers an automatic stay that temporarily halts a pending tax sale.15Office of the Law Revision Counsel. 11 USC 362 – Automatic Stay Bankruptcy does not erase property tax debt, though. The lien stays attached to the property no matter which chapter you file.
Chapter 13 is the more practical route: delinquent property taxes can be repaid over a three-to-five-year plan while you keep the home. Chapter 7 can discharge personal debts, but the tax lien survives, so keeping the home still requires paying the full amount owed.
The automatic stay also does not cover property taxes that come due after you file. The county can continue creating and perfecting liens for new tax obligations while the case is open.15Office of the Law Revision Counsel. 11 USC 362 – Automatic Stay
The State’s Postponement Program for Eligible Owners
If paying is a real hardship and you meet the criteria, California’s Property Tax Postponement (PTP) Program lets you defer current-year taxes. The state loans the money at 5% annual interest, secured by a lien on the home. Deferred taxes and interest become due when the home sells or ownership changes.
To qualify for the 2025–26 program, you must meet all of the following:
- Be at least 62 by December 31, 2025, or blind, or have a disability expected to last at least 12 months.
- Own and occupy the home as your primary residence, continuously since December 31, 2024.
- Have total household income of $55,181 or less for the 2024 calendar year.
- Hold at least 40% equity (total liens, mortgages, and encumbrances cannot exceed 60% of fair market value).
- Have no reverse mortgage on the property.
The filing period runs from October 1, 2025 through February 10, 2026.16California State Controller’s Office. Property Tax Postponement For eligible senior and disabled homeowners, this program can prevent the default-and-sale process from ever starting.