What is the legal effect of a tax or assessment foreclosure filing?
At the time the tax or assessment foreclosure complaint is filed, a companion filing called a lis pendens is also made. The lis pendens puts title searchers and other searchers of the public records on notice that the title to the property is now being foreclosed. There is no real defense to a property tax or assessment foreclosure complaint and lawsuit. The main purpose of the foreclosure process is to notify all interested parties that any legal interest they may have in the property will be terminated and extinguished if a tax or assessment foreclosure sale of the property is completed. This is because property tax liens and special improvement assessment liens are ahead of and superior to all other liens, except (in a limited extent) to filed income tax liens held by the North Carolina Department of Revenue. When a superior lien is foreclosed, it cuts off all junior liens and ownership rights.