What is a Tax Lien Certificate?

What is a Tax Lien Certificate?Let’s begin by understanding the definition of a tax lien.  Counties put a lien on a parcel for the reason of delinquent taxes by the homeowner.  Then, the county publishes a list of all tax sale properties available.  They set a time and place where the auction would be held.  They also give out information on what to bring along as well as the fees required.

The treasurer of the county usually does all the auctioning on the day of the sale.  If you decide to purchase a tax lien certificate, you’re going to be the lien holder of the parcel.  By becoming a lien certificate holder, you need to understand two situations.  First, once you invest your money, you’re guaranteed on profits with your initial investment.  Second, if the homeowner doesn’t pay his back taxes on the due date, then you can foreclose the property and apply for rights of ownership.  You become the new property owner with no mortgage or other liens.  As you can see, tax lien certificate investing is not only fun but also very rewarding.


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