Final answer:
The buyer of a tax certificate pays overdue property taxes in exchange for the right to apply for a deed to the property, which does not give immediate ownership nor tax exemption. Property taxes are essential for funding municipal services and vary based on real estate values.
Step-by-step explanation:
The buyer of a tax certificate agrees to pay the taxes due on a property in return for the right to apply for a deed to the property. This arrangement does not result in immediate legal title to a property, nor does it exempt the buyer from paying property taxes. Instead, the tax certificate is a lien on the property for unpaid taxes, and the holder may eventually have the right to foreclose on the property if the taxes remain unpaid. The process of buying tax certificates is one way that municipalities manage delinquent property taxes, with the central goal of revenue collection for local governments' budgets, which pay for public services and facilities.
Property taxes are critical for municipal functions, and they are determined based on the value of real estate like houses, gardens, mills, fields, and vineyards. When local governments depend heavily on property tax, changes in the economy can significantly impact the revenue. To manage this revenue and related expenses, some homeowners make use of an escrow account which is helpful for managing property tax payments alongside other regular housing-related expenses.
Answer: c. Agrees to pay the taxes due on a property in return for the right to apply for a deed