Redeemable Deed Explained

Redeemable Deed ExplainedA lot of investors know the difference between a tax deed and tax lien.  Investors understand that when they buy a lien certificate, they are not buying the property but would pay for its delinquent taxes.  They are also putting a lien on the property so that if the homeowner fails to pay his dues plus interest and penalties, the lien holder can foreclose the property after the redemption period.  Investors also understand that when they buy a tax deed, they are actually buying the property and can get the right of ownership.  There are those however, has no idea yet on what a redeemable deed is and its difference to a lien.  Here is a brief explanation:

Redeemable deed is like tax lien and tax deed mixed into one.  In a redeemable deed sale, you are actually buying the property’s deed.  However, the deed is restricted during the redemption period.  This redemption period is different from a liens scenario though.  The homeowner can redeem his property by paying the full amount that was bid for the deed plus a heavy penalty.  If the deed is not redeemed, the homeowner is no longer allowed to get back his property.  The deed holder is now the new legal owner of the property.


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