Can You Make Money Buying Tax Deeds To Properties?
"Can you make money buying tax deeds to properties
?" The simple answer is: of course! If you are able to get a property at tax deed auction for a low enough amount, and the buyer doesn't redeem the property in the year waiting period afterwards, and then you are able to sell the property for a profit, then yes: you can make money buying tax deeds to properties. However, there's a much simpler way, and a big tax sale secret when it comes to buying tax deeds.
First of all, you've got to avoid the tax sale. There's far too much competition for the above scenario to ever play out, and 95% of the time if you do get a deed, the owner pays you off in during the redemption period. You have to have all cash at the sale, and you can't inspect the property beforehand. Not a good deal.
The best way to make money buying tax deeds is to buy the delinquent deed directly from its owner. By the end of the aforementioned redemption period, most owners who can will have paid off. The rest are now in a new category: desperate sellers. And some of these folks fall into an even better category: people who own property, and don't know it went to tax sale. Heirs, absentee owners and the like fall into this category, and they're great prospects.
With these folks at this point in the process, you'll be able to pick up a lot of deeds for a tiny fraction of their worth. Many will sign their deeds over for just a few hundred bucks, just to keep it from going to the tax sale company that bought the deed.
Another way to make insane money from this process is by reuniting former owners with their overbids. Overbids happen when someone bids more for a property than was owed in taxes. The owner is due the funds, but frequently unknowingly leaves the money behind. After a while, the government gets to keep that money.
Due to a legal loophole, you can charge 30-50% on these funds as a finder's fee, as long as you know which funds are okay to go after. There are billions sitting in government coffers right now, about to be lost permanently. With the foreclosure rate being what it is, there is a huge opportunity here to get owners some of their money back, while getting a very nice income yourself.
by: Maggie Dawson
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