Are you looking to purchase a tax lien investment property? If your answer is yes, then you’ve made the right choice in spending your hard earned money into something lucrative. However, to make sure that your investment is really worthwhile, research ahead to avoid costly mistakes. Also, to ensure that the deals you’re getting are profitable. Be cautious on the correct way of purchasing a property as well.
Keep in mind the location of the property you’re interested. Ideally, select a property in a location wherein it is situated conveniently near various amenities, such as a school or business district. So, when the time comes, its price would surely go higher and you can make more profit.
Assuming that you have closed out a good deal on a tax lien property and got its deed, what’s the next thing you’re going to do? You probably have a list of repairs and corresponding costs. Are you going to do all the work yourself? Or hire people to do get it done?
If the list of repairs is not too many, maybe you can do the work yourself to save money. However, time is gold. So, make sure that you can finish the tasks ahead of time so that you can flip the property for more profit.
The extent for being successful by buying and investing in real estate is incredible with tax lien certificates. It is because you can expect returns of up to 26% on your initial investment. Redemption period may vary from state to state and can last up to 3 years; however, the interest rate and other fees can give an enticing return of investment.
With tax lien certificates investment, you can do it at your own time while having a main job. Counties offer auctions of the lien certificates at various dates. You can check out the schedules at the nearest county office. Select which properties you’d like to bid on and do a background check first prior to participating the auction.
When tax delinquent homeowners are given enough time as well as notices to pay the tax debt, and fail to do so, tax collectors would then list their property in tax lien auctions. The homeowners are informed of the sale. Also, it is published in the local newspaper.
Once the tax lien auctions are done, homeowners are given a fixed time frame which is called the redemption period. It is the appropriate time for them to repay the lien plus interest and other fees.
If the tax due amount is not paid within the redemption period, then foreclosure of the property cannot be avoided. The lien certificate investors are granted full rights of ownership to the properties. Thus, there is huge potential of earning profits in tax lien auctions.
Whether or not the economy is stable, you need to invest in a sure thing such as tax lien properties. In this type of investment, you would surely get your money back one way or another. This investment produce positive results with less the risk. It is a great investment for new property investors, even with small capital to spend up front.
Investing in tax lien properties is happening for quite a while now. If you are keen in purchasing tax lien certificates offered by the government, contact the nearest county office and inquire about the date of the next public auction. Also, there you would know about the requirements needed as well as the methods of payment when you win a lien certificate to the property.
The U.S. government has two types of tax sales. First one is tax deed sales, and the second is tax lien auctions. Liens are filed against homeowners who failed to update their taxes. And for the most part, it has something to do with delinquent property taxes. Furthermore, the lien’s face value is the amount owed in back taxes as well as any costs associated with it.
Tax lien auctions are held every year by the government. The sale happens in almost all states however, the laws vary from county to county. Be sure you research the rules in the county where you’re purchasing the lien. Also, create a plan ahead of time and budget your bids to avoid costly mistakes.
Tax lien certificates are a good investment. However, there are some details that may surprise those who are new to the business. It is because tax sales happen each year and different liens could be present on the same property for various tax years. This may cause confusion and misunderstanding which is why due diligence is needed.
Laws on some states are very clear when it comes to tax lien sales. Also, it is good to know that some of them own the tax liens. So, when it comes to various liens, getting a clear title is a must to have a peace of mind. Do this in order not to get surprised with the results.