Basic Investing Insights

Understanding the Redeemable Tax Deed Sales in Tennessee

Rachel Seidensticker
Sign-up to receive an Unprecedented Report of sale results data nationwide.
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
Check out Tax Sale Insiders for the latest industry news and insights.

Introduction to Tennessee Redeemable Tax Deed Sales

Redeemable deeds are the third and lesser-known option for investing in tax sales because only a handful of states use them for delinquent property. 

One of these states is Tennessee, which often gets overshadowed by other southern states that offer redeemable deeds. 

However, Tennessee is a redeemable deed powerhouse in its own right, providing unique advantages to investors who understand the state’s process.

Remember, redeemable deed states have an interest rate that investors can earn money on and a set period for homeowners to pay back their taxes. 

If the redemption period expires before the homeowner pays, the investor becomes the new property owner. In Tennessee, the interest rate is 10%, with a one-year redemption period.

These dynamics create a fast-moving investment scene where investors jump on deals to either earn a quick 10% or add property to their real estate portfolios. 

Distinguishing between a diamond in the rough and a bad investment can be challenging when you’re put on the spot at one of Tennessee’s live auctions.

Fortunately, Tax Sale Resources has been in the business for over fifteen years, researching redeemable tax deed sales in Tennessee and across the country. Our database and industry knowledge empower investors to pounce on properties that fit their investment models. 

Read on to understand the state’s tax sale process and how to succeed as a redeemable deed investor.

The Tennessee Redeemable Tax Deed Sale Process

Here are the essential details to understanding Tennessee’s redeemable tax deed sale process:

Common Misconceptions - Is Tennessee a tax lien or a tax deed state?

Firstly, Tennessee is a redeemable deed state, a distinct category in the world of tax sales. 

While some states sell tax liens and others sell tax deeds, redeemable deeds function differently. 

In Tennessee, investing in properties through an auction offers two possibilities. One possibility is that the homeowner pays the back taxes, fees, and interest, leading to a healthy return for the investor.

On the other hand, the homeowner might fail to pay what they owe on the property. In this case, if the owner doesn’t pay the delinquent taxes (also known as redeeming the property) within one year, the investor can file for the deed to the home, becoming the new property owner.

As a result, investing in Tennessee’s redeemable deeds means you’ll end up owning property at some point. That being said, most deeds redeem, meaning you’ll reap the interest rate (10% in Tennessee) on most of your bids. You’ll also receive back what you paid for in penalties, fees, and the premium (which is a surplus amount you add to your maximum bid).

Another point to remember is that redeemable deeds in Tennessee give the owner one year to redeem. For this reason, patience is crucial for investing in this state. 

While Delaware, another redeemable deed state, has a redemption period of sixty days, Tennessee gives delinquent homeowners more of a chance to catch up on property taxes. 

So, if you’re into redeemable tax deeds for the prospect of owning property, you’ll need to play the long game.

When are the Redeemable Tax Deed Sales in Tennessee Held?

Unlike some other redeemable deed states, Tennessee’s tax deed sales occur sporadically throughout the year. 

So, instead of attending auctions on a specific day each month, investors must stay abreast of each county’s unique tax sale schedule. Some counties host multiple sales throughout the year, while others can go several months without holding a sale.

For example, Blount County holds one annual tax sale, while Shelby County usually holds two sales per year. As a result, due diligence is required to keep up with when tax deed auctions occur in Tennessee.

Fortunately, doing so is easy with Tax Sale Resources’ Research platform

Our Management platform shows when and where upcoming auctions are happening, calculates your return on investment for each property, helps streamline your workflow, and gives in-depth information on the properties for sale at the next auction.  

What are the Rules of Redeemable Tax Deed Sales in Tennessee?

Tennessee law gives homeowners one year to redeem their deed if it’s sold at auction. 

This rule means investors must wait out the redemption period before moving forward with ownership through a quiet title action. 

During this one-year timeframe, the homeowner can retain their property by paying the taxes, interest, and fees.

This situation is a win-win for investors. On one hand, redeeming the property means receiving your investment back with interest, which is 10% in Tennessee. On the other hand, if the property doesn’t redeem, you can become the new property owner. 

Remember, you’ll also pay a premium when you bid, which is an amount over the value of the taxes and fees. The premium is a double-edged sword because it makes bidding on properties more expensive, and the homeowner doesn’t pay interest on this overage amount. 

However, you’ll need to offer higher premiums than other investors to win the bid. So, risking more money on an amount that doesn’t return interest may be necessary to beat other bidders.

Winning with a higher premium also means having the cash to back up your bid. Failing to pay the price you offered at the auction can result in the county or state banning you from tax sales for two years or more. 

Therefore, getting your finances in order before attending an auction is critical. Tax Sale Resources partners with investors through its financing program to ensure you have the money on hand that you need to maneuver quickly and scale your business within months instead of years.

As mentioned previously, transferring homeownership after the redemption period means filing a quiet title action for the property. 

A quiet title nullifies claims to the property from past owners and interest parties. However, quiet title is distinct from an insurable title. As the name implies, an insurable title allows you to insure the property, a requirement to sell or finance it. 

So, selling the property is a multistep process that can take several months or more, and it’s vital to consider how this timeframe impacts your investment model.

What to Expect with Redeemable Tax Deed Sales in Tennessee?

When investors who are active in the redeemable tax sales scene in Tennessee should expect to be on the go throughout the year. 

There is no set statewide tax schedule, meaning auctions occur both online and in-person in a scattershot manner. As a result, investors must closely monitor postings closely to know when and where Tennessee redeemable tax sales are happening.

Additionally, Tennessee tax sales are “as-is,” meaning there are no returns or refunds. For this reason, due diligence is essential for investors. Going in blind and firing from the hip at an auction can leave you with a disaster instead of an asset. 

For example, you might bid on a parcel thinking it’s a home only to end up with a strip of sidewalk with a mailbox. Likewise, the property could be a demolished home or have a host of issues with the title. These issues can add staggering costs to owning the property and tank your investment.

Pros of Investing in Redeemable Tax Deed Sales in Tennessee

Investing in redeemable deeds in Tennessee means you can profit in one of two ways: redemption or property ownership. Here are the specific ways investors come out ahead:

  • The 10% interest rate doesn’t accrue over time. Instead, the county adds it to the amount due as soon as you purchase the redeemable deed. As a result, you’ll receive the same return on investment whether the property redeems in two weeks or ten months.
  • The immediate interest also means that you can reap profits quickly by picking properties you think will redeem within a few weeks or months.
  • On the other hand, picking properties you don’t think will redeem can also work well. After holding on to the deed for a year, you can initiate the title transfer process and become the new owner.

Cons of Investing in Redeemable Tax Deed Sales in Tennessee

Several pitfalls can also threaten your returns. Here’s what to know about the drawbacks of redeemable deed sales in Tennessee:

  • Other redeemable deed states offer higher interest rates. For example, Georgia investors receive 20%, double the amount in Tennessee.
  • You don’t receive your premium back if you win a bid. In other words, the modest 10% return is less the premium you pay for each deed.
  • When the redemption period expires, you must file a quiet title action. This puts your investment timeline at 15 to 18 months minimum before selling or renting out a property. Plus, quiet title actions involve attorney fees.

Researching Redeemable Tax Deed Sales in Tennessee

Thorough research is crucial to successfully investing in Tennessee’s redeemable deeds. 

To that end, Tax Sale Resources’ Research tools are indispensable for gathering details on properties and projecting your earnings. Remember, Tennessee doesn’t have a set schedule for auctions, so viewing them ahead of time through our Research platform is an excellent way to never miss a sale, whether it’s online on the steps of a county courthouse or online.   

Financing your Tennessee Tax Sale Investing

Financial resources can inhibit your investment growth if you have limited resources. 

For example, say you have enough money to purchase one redeemable deed in Tennessee this year. You’ll wait up to a year to receive the return on investment or longer if the property doesn’t redeem.

This situation means you’re strapped for the rest of the year, and you’ll miss out on dozens of auctions where you could be bidding on more properties. Plus, traditional lenders won’t accept redeemable deeds as collateral for a loan, leaving your cash locked down in the property.

That’s where Tax Sale Resources assists redeemable deed investors. 

Our capital partnership program gives financing for up to 100% of the purchasing price of each deed. This way, you get your money back and can purchase more deeds that fit your investment model, scaling your business far faster than going as a lone wolf.

The financing program is excellent for Tennessee investors because you can maintain a flow of properties into your portfolio. 

Instead of waiting for a deed or two to redeem, you can increase your returns exponentially and accomplish your goals in a shorter timeframe.

Tennessee Tax Sale Insights for the Future   

As the recent activity in the Supreme Court has shown, tax sales can change at the drop of a hat. Here’s what investors should anticipate for the future of Tennessee redeemable deed sales.

Legal Considerations While Investing in Tennessee Tax Delinquent Properties

Every tax deed purchase has legal ramifications, such as when you purchase a property that is part of an ownership dispute between a mortgage company and the previous owner. 

These situations are varied and complex, so it’s best to consult an attorney and conduct thorough research when investing in redeemable deeds in Tennessee.

Current Trends

The tax sale trends in Tennessee have followed the national trends in terms of volume for the past few years. After 2020 saw a sharp dip in quantity and investment activity, the past three years have demonstrated a return to normalcy. Investors will likely see consistency in the amount of properties available in the market in 2024.

Potential Tyler v Hennepin Ramifications to the Tennessee Tax Sale Process

Because Tennessee tax sales involve premiums, the Tyler v. Hennepin case is more likely to affect local tax sales. 

As a result, the state or some of its counties might temporarily halt tax sales while they tweak auction procedures and tax sale regulations. 

Additionally, homeowners might file lawsuits disputing ownership or redemption amounts in light of the Supreme Court ruling. 

However, no news is forthcoming about Tennessee holding onto premiums that belong to homeowners, which is a promising sign that no major changes are necessary.

Forward-Looking Insights Based on the Tax Sale Resources Data

Because popular redeemable deed states like Georgia and Texas have overshadowed Tennessee in the past, investors may not be as familiar with the state’s tax sale processes. 

For this reason, investors have shied away from the state in the past.

However, if you’re comfortable investing in redeemable deeds, Tennessee fits the bill of providing high-powered real estate investments. 

Remember, the state’s interest rate is on the low side, meaning it’s best to bid on deeds that will either redeem quickly or become your property with few to no issues.

To get your hands on these properties, you’ll need to physically travel throughout the state. 

Although a few counties in Tennessee have online bidding, most of the auctions in the state are still live. In-person auctions cut down the amount of competition because the only people who can bid are the ones who are there (as opposed to an online auction, where you can get a swarm of investors from around the country). 

These live auctions have fewer corporate-backed investors, leaving more room for smaller players to nab great deals.


Tennessee stands out as a redeemable deed state with its fixed 10% interest rate added immediately to the purchase and year-long redemption period. 

Investors can take advantage of the dual potential of earning returns through property redemption or becoming new property owners.

That being said, the state's interest rate is lower than other redeemable deed states, and filing a quiet title action extends the investment timeline. This dynamic requires thorough research before heading to an auction to avoid disastrous investments. Additionally, the state's sporadic auction schedule will keep investors on their toes throughout the year. 

Tax Sale Resources has your back, providing research and investment insights to help you grow your redeemable deed business in Tennessee.

Author - Rachel Seidensticker
Rachel Seidensticker
Chief Operations Officer
In the Tax Sale Industry Since 2010
Rachel is responsible for managing and overseeing the daily operations of Tax Sale Resources, which produces data for approximately 8,000 nationwide tax sales yearly. She started in the tax sale industry originally as an investor but decided to change course and team up with her brother (Brian Seidensticker) to build Tax Sale Resources quickly thereafter.

Featured Articles

Looking for which sales have the best returns?

Sign-up to receive an unprecedented report of sale results data nationwide.
Benefit Check
Sale Sizes
Benefit Check
Winning Bid Details
Benefit Check
Details by Property Type
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.