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How Tax Deed Investing Is Different Then Buying Tax Liens

Tax deed investing was created by state legislatures over 200 years ago in the United States. A tax deed is a property deed issued by the local government (county, city, township, town, parish); it’s a transfer document for real estate, transferring a property, which is sold at auction for non-payment of back taxes.

A tax deed investor typically buys a tax deed from that local government at auction for as low as the delinquent taxes, plus any premium that is bid during the auction process. In some unique cases investing in tax deeds can be done directly with the local government, after the auction process, for just the cost of the back taxes. In most states that sell tax deeds those investing in tax deeds get full ownership of the property following the sale, though in some states there is still some short period of time allowed for processing paperwork or giving the delinquent tax payer some final short time to redeem the property.

In all cases the sale of property at a tax deed auction or sale is regulated by State law and administered at the local level. The end result is that when investing in tax deeds you get the property at a cost of the unpaid taxes and fees plus any additional amount that may be bid at auction. Tax deed investing may result in buying the tax deed well below market value, sometimes for just pennies on the dollar.

Tax deed investing opportunities are available in about 50% of the states (Click Here For Our List Of Those States) in the USA and tax liens are available in the other 50%. Investing in tax deeds is available to foreign investors, from Canada, Europe, anywhere in the world. The business of tax deed investing requires a little more involvement on the part of the investor than tax lien investments. In the case of tax deed investing you will own the property if you are the high bidder at a tax deed auction. Various strategies can be used when investing in tax deeds: for example;

  1. A strategy of buying properties, usually residential homes that can be quickly sold for a profit. Those, who following that strategy attempt to buy below the current value of that property and sell for the current value.
  2. A strategy of buying and renovating is used by some. In this strategy properties that need work are sought out and purchased. Someone knowledgeable in renovation and current market demands can make this a profitable business.
  3. Some like to buy vacant land. This tax deed investment approach works well especially with land in a developed area.
  4. Sometimes odd parcels or buildings get neglected by those investing in tax deeds, a clever and experienced tax deed investor is often able to buy such properties for only the back taxes.

Ted Thomas began teaching and guiding new tax deed investors the secrets to successful tax deed investing over 25 years ago. Over that time Ted Thomas has become known as America’s Tax Lien Certificate and Tax Deed Authority, and has shown thousands of people how to profit in the lucrative business of investing in tax deeds. In the video linked below Ted introduces tax deed investing including a presentation recorded at one of Ted’s live training events, the person speaking is a student/investor, explaining her experience.

 

Wikipedia puts their 2 cents in on Tax Deed Sales Here

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