Selling a house in Georgia: transfer tax, foreclosure, and what you still have to disclose

Georgia has no state-mandated seller disclosure form, and that is the fact most sellers get wrong. No required form is not the same as no duty: Georgia courts have held a seller liable for passive concealment of a known defect the buyer could not see. The transfer tax is $1 on the first $1,000 and 10 cents per $100 after that, which is $250 on a $250,000 sale, and the statute puts it on the person who signs the deed. If the house is in foreclosure, Georgia sells it without a court judgment, and the sale can be on the courthouse steps 30 days after the notice goes out.

The transfer tax and who owes it

O.C.G.A. § 48-6-1 sets the rate at $1 for the first $1,000 or fractional part of $1,000, and 10 cents for each additional $100 or fractional part of $100, on any deed or instrument conveying realty where the consideration or value exceeds $100. The value excludes any lien or encumbrance that existed before the sale and is not removed by it, so a house sold subject to an existing mortgage is taxed on a different figure than one sold free and clear.

The statute makes the tax payable by the person who executes the deed or the person for whose use or benefit it is executed, which is the seller. Contracts often move it to the buyer by agreement, and that agreement binds the parties without changing who the statute names. Section 48-6-2 lists the exempt instruments and requires the consideration to be shown. The clerk of superior court collects the tax when the deed is filed.

No required form, and a real duty anyway

Georgia follows caveat emptor as a starting point and has no statute requiring a residential seller to complete a property condition disclosure. Most Georgia sales still use a disclosure form, because the parties choose to, not because the state requires one. The duty lives in the case law instead.

Wilhite v. Mays, 140 Ga. App. 816 (1976), sorted seller fraud into three kinds: positively misrepresenting a fact, active concealment that prevents the buyer from discovering the defect, and passive concealment. The seller in that case had sold a house whose septic system overflowed in wet weather and which he had never managed to repair, and argued that saying nothing could not be fraud. The court held otherwise, recognizing an exception to caveat emptor that places a duty to disclose on a seller who has special knowledge not apparent to the buyer and knows the buyer is acting under a misapprehension about facts that would matter to the decision. The Supreme Court of Georgia affirmed the result the following year.

The practical version: a known defect the buyer cannot see on a reasonable inspection is one you disclose in writing. Answering a direct question falsely is worse than saying nothing, and saying nothing about a hidden problem you know of is its own exposure. Writing it down also ends the argument later about what you said at the kitchen table.

One narrow area runs the other way. Section 44-1-16 says no cause of action arises against an owner or broker for failing to disclose that a property was the site of a homicide, felony, suicide, or a death by accident or natural causes. The same section requires a truthful answer to the best of the person’s knowledge if a buyer asks.

Federal law still applies on top of all of this. A house built before 1978 carries the lead-based paint disclosure obligations regardless of what Georgia requires.

Non-judicial foreclosure moves on a 30-day clock

A Georgia security deed with a power of sale lets the creditor sell without going to court. Section 44-14-162.2 requires notice of the initiation of proceedings to be given to the debtor no later than 30 days before the proposed foreclosure, and requires the notice to name the individual or entity with full authority to negotiate, amend and modify the terms of the mortgage, with an address and telephone number. The debtor means the grantor, or the current owner where the creditor has been told about a transfer.

Section 44-14-162 makes a sale invalid unless it is advertised and conducted at the time and place and in the usual manner of the sheriff’s sales in the county where the real estate lies, and unless the § 44-14-162.2 notice was given. Section 9-13-141 sets the advertising: where the law calls for publication for 30 days or four weeks, publishing once a week for four weeks, one insertion in each of the four calendar weeks immediately preceding the sale, is sufficient.

Those two clocks run together, which is why a Georgia foreclosure can reach the courthouse steps quickly compared with a state that requires a court hearing first. A sale that closes before the foreclosure sale pays the loan from the proceeds and ends it, and that is a question of whether the calendar and the payoff both work.

The confirmation requirement after the sale

Section 44-14-161 is the protection worth knowing. When property is sold on foreclosure under a power of sale and does not bring the amount of the secured debt, no action for a deficiency may be taken unless the party who foreclosed reports the sale to the judge of the superior court within 30 days and obtains an order of confirmation and approval. The court must hear evidence of the true market value and cannot confirm unless it is satisfied the property brought that value, and the debtor gets at least five days’ notice of the hearing. A creditor who skips confirmation loses the deficiency.

Building a net sheet

Start with the price, then subtract the payoff, the transfer tax at $1 plus 10 cents per $100 above the first $1,000, the attorney and title charges, the property tax proration, any agreed repairs, and the commission if you list. Add the months of taxes, insurance and utilities you will carry while the house is on the market. Our page on what an empty house costs prices those months, and cash offer vs listing puts the two routes side by side.

We buy in Georgia as well as Tennessee, for our own account, and we may assign the purchase contract to another buyer, disclosed in writing before you sign. How we calculate an offer shows the whole subtraction behind the number.

This is general information, not legal or tax advice. Talk to a Georgia attorney or CPA about your situation.