Tax Lien Certificates and Tax Deed Auctions.
While no one likes paying taxes, for some, the word “tax” is synonymous with “opportunity.”
Taxes can sometimes be profitable. Just ask those who own tax credits or participate in tax lien auctions.
In fact, a whole new industry has boomed from people that scour local auctions for real estate sales, caused by delinquent taxes. These forced sales, or tax lien sales, are becoming more and more mainstream and popular with the general public.
What is a Tax Lien?
In most jurisdictions, when a property owner is late on paying real property taxes, the county or municipality will issue a a tax lien on that person’s property. Certain states allow the tax lien to become a first lien on the property, which is then turned around and sold at auction as a tax lien certificate.
After placing a successful bid, buyers of a government-issued tax lien certificate will then get one of two things:
1) A state-mandated yield from the lien, which the delinquent taxpayer must pay in order to release the lien, OR
2) Title to the property (after a certain amount of time, set by the jurisdiction) if the delinquent taxpayer fails to pay up.
Individuals have been snapping up tax liens more and more because of these two benefits. A fixed percentage rate, mandated by a government agency, or the title to property at a substantial discount are incredible benefits rarely seen with other real estate transactions.
In this full length Instructional Video, Tax Lien Investors and Government Officials explain the tax lien certificate process.
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