What The Experts Won't Tell You About Tax liens and Deeds Investing

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When I started getting involved with tax liens and deeds investing I had consumed books, online readings, youtube video and every inexpensive resource I could find. The book that I found to be most informative was “Profit by Investing in Real Estate Tax Liens” by Larry B. Loftis, Esq.
One thing all my studies had in common was it only took you as far as the what liens and deeds are. It provided some information on how to buy them. No one tells you the whole story.
 
So I decided to change that, and for the sake of this article I will use a tax liens process in Florida. Keep in mind that tax liens differ from one state to another and possibly from one county to another.
 
After buying a lien in Florida you have a redemption period of 22 months – at least in most counties. Because Florida is a bid-down strategy the lien will carry some high or low interest rate.
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Lien Is Not Redeemed

If the lien was not redeemed, you can start the foreclosure with the county. The county handles it for you but you need to initiate it PLUS pay the foreclosure fee PLUS pay the additional taxes due. None of the experts told me that or told me how much this phase would cost. The foreclosure fee is several hundreds dollars and due taxes depend on how much is due for the specific property.
So far you are out of pocket the cost of the lien, cost of foreclosure and due property taxes (if there are any).
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Foreclosure Process

The process can easily take many months and maybe even a year (or more). It depends on the county’s load and other considerations out of your control. The good thing is that no matter what the rate is on your lien once the foreclosure starts you are getting 18% rate.
At the end of the foreclosure the property will go to an auction. Only if you don’t bid on it or if no one else bids and buys it at the auction you have the right to buy it.
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Buying The Property

No one bid and bought the property at the auction. You have the right to  purchase it but it will cost you. It will probably cost you between $5,000 – $10,000 of different county fees.  Homestead properties  are more expansive.
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Owning The Property

Now that the lien was not redeemed, the foreclosure was over, the property was not purchased at an auction and you paid all the fees – you own the property and have the right to do whatever you want with it.
It ended up costing you several thousand dollars, probably more then you expected, but most likely still worth it.
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Most experts say that most liens WILL BE redeemed.
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Tips for Smart Liens Purchases

  • Decide what property you would buy and what you would not: mobile home, land, single family, condo, etc.
  • Check to see if there are additional taxes due
  • Check if the property is homestead or not
  • Check for property’s market value (you can use zillow.com, trulia.com, and other sites)
  • Before buying the property (after the foreclosure) consider paying an professional inspection.

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Want to learn MORE about Tax Liens before starting to invest in Tax Liens?
Tax Liens Investing & Myths
Presenter: Dani Beit-Or
> Course includes: PDF file and Video recording.
This course explains investing through Dani’s system that has lead him to personal success.
Covered in this course:

  • What are tax liens and tax deeds
  • Benefits of investing in liens and deeds
  • Risks involved with investing in liens and deeds
  • Myths about liens and deeds

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