Prior to participating in a tax deed sale, all property investors must know the answers to the following questions, aside from doing due diligence and research:
-Does the buyer of the tax deed get interest if the property is redeemed by the owner?
-Is there a redemption period after the tax sale?
-Are there any available financing programs?
-What are the terms of payment?
-What are the forms of payment?
When the investors have answered these questions, it would be easier to understand the process of tax deed sales. Plus, investing would be more fun and earning profits keep coming in.
It is important for you to have objectives and goals as a tax deed investor. We know that it is exciting to purchase properties just for the fraction of its market price. However, before making your very first property investment, it is a nice idea to ask these questions:
*Do you want to purchase a residential real estate or commercial?
*Do you want to use the property as your own or resell it?
*Do you want to purchase a vacant lot to build your home in it?
*Do you want to rent the property to others for a positive cash flow?
Think about the answers to these questions in order to formulate a long-term plan. Also, do a thorough research before investing.
Securing the property ownership is not that difficult after the redemption period when the owner failed to redeem. During the foreclosure of the property, you are going to acquire the rights to ownership. Debts and subordinate liens concerning the property would be cleared. This gives you the opportunity to secure good passive revenue because with tax lien certificate investment, there is no need to worry. Just sit back and wait for the redemption, and count the profits coming in. Let the people in charge of the sale do some of the work for you. The county handles the enforcement of the purchased lien and the property foreclosure as well.
Property ownership is not the only way for you to earn profits from this lucrative investment. Work in a smarter way by going for tax liens of the later years, avoiding competition from other investors. If the owners of the delinquent tax lien properties default on the coming year’s taxes, then you can strike a deal with them which can benefit both sides.
If you haven’t attended a tax lien sale of delinquent properties, pre-registration on every bidder is required. This depends on the state and county that conducts the sale where you want to bid. Most states require a refundable deposit usually in cash or certified funds in order for the sale to push through. However, not all states require certified funds. It is because other states are willing to accept personal checks; this is why you need to do some research first in order to be qualified.
On the day of the tax sale, a full payment in certified funds is expected for lien certificates. The county or state would not let you leave without paying for the lien. On the other hand, some states allocate a certain period of time for you to produce the amount needed to pay. If you fail to pay up within the time frame, the property would be sold later on or re-bid to other prospect bidders.
Tax liens and deeds is a worthwhile investment where you would receive:
a. Secured investment with high returns.
b. You would also get the discounted price of the property that can be flipped and sold for more profits.
Some say that it would just be a waste of time to compete in bidding especially with the big players around. But if you have ever been to auctions, it would sometimes be exciting especially when there aren’t very many people around. You would surely get the properties you’d like with less competition.
Always double check each property you want to buy. You need to be aware of what you are planning to bid on and if it is difficult to verify, then move on to the next parcel that possible information can be acquired.
It is quite amazing how many people do not know yet about tax liens and deeds investing. They have little idea on these secure profiting methods that actually exist. It is actually around for many years now. If you make a step ahead of them, then you’re going to reap the profits from investing in tax sale properties.
If you are worried that it might be pricey to get into this business, you’d find out that tax lien and deeds can be bought in all sorts of price ranges. Some can be as low as $25 and all the way up. Since tax liens are superior to mortgage, the mortgage liens on tax sale properties would be wiped clean. You get a guaranteed high rate of return when the property owner pays his tax dues. As for deeds, you get the property free and clear. Everybody wins even for the owner and the county as well who issued the lien.
Real estate investment through tax lien certificates is not a big deal to some people but to a savvy investor it presents a big opportunity to make money. The holder of a tax lien certificate would have a big smile knowing that this gem can give profits when the redemption period ends. Few people know this as not many investors share this secret of investing.
Tax lien certificates are one of the safest and secured types of real estate investment that can provide you good returns. It is not difficult to invest in lien certificates especially if you have done due diligence and possess the right knowledge. Also, researching ahead of time is important to avoid costly mistakes. If others have succeeded in getting returns by investing in tax lien certificates, so can you.