A Guide To Investing In Tax Liens
Investing in tax liens is a good way to purchase property. Properties that have tariff debts owed on them contain very minimal risks for the buyer. You don't need a big pile of money to get your hands on some pieces of prime real estate. If you want to start investing in tax liens, do some research and learn all you can about the process before you get started.
It is best if you are knowledgeable about what goes on during the process while you are thinking about purchasing county owned property. The regulations vary among each city and state. One state will give you a deed, while another will give you a title. You need to know the difference between the types, to make sure you know what your rights are concerning the property. Before you start bidding on property in other cities and states, start in your own jurisdiction first. This will allow you to get more familiar with the process in your area. The goal of the auction is to make enough money off the buyer to cover the past due taxes, and make a bit of profit for the county. Keep in mind that some areas hold this type of sale several times a year. Most of the available homes are no longer occupied by their owners.
Make sure you have enough money. If this is your first time investing in tax liens, then you need to make sure that you have enough money on hand to meet the reserve bid, and more if the price goes up. It is possible to find homes for sale for only a few hundred dollars. Although this is not that common, you can get some really great bargain deals by investing in tax liens. When you purchase these kinds of homes, you are responsible for the tariff debt that is owed to the county. Keep in mind that an owner still has a little leeway time to pay off what is owed before the auction is over. In the event that the original owner pays what was owed and pays the penalties before the sale is final, you are no longer contractually liable for the place. Redemption periods vary greatly from state to state, so make sure you are aware of the owner's right before you start planning a future in a home that you purchased from an auction. If they don't pay before the redemption period is over, the property becomes yours. Make sure that all of the rights and paperwork have been transferred over to your name.
Don't think that by investing in tax liens you can now purchase an expensive home. It is best if you start off on the lower end of the spectrum and work your way up. Take a small amount of money and invest in several different properties instead of one. This increases your chances of winning. The larger the tax lien against a property, the likelier it is that a bank or major corporation is going t purchase the property right from under you. Rather than be disappointed since you had all of your money on one piece of property, you still have your options open when you diversify your bids.
by: Aloysius Aucoin