Imagine getting a $ 100,000 home or property for a few hundred dollars. When buying tax lien certificates, this is very possible and many people have obtained properties in this way. However, you are more likely to get these same properties for a few thousand dollars. You must have some tax lien certificates for this to work, as you are the person initiating the tax deed application (the first step in the foreclosure process) and you will know an approximate date when this process will occur. Remember, you started the Tax Deed application process and it typically takes six to eight months to complete.
Possessing multiple tax lien certificates gives you the ability to apply for the tax deed on all of them at the same time. This process will allow you, as a present or future investor, to save enough money to obtain real estate for “Pennies on the Dollar”. Many tax lien certificates are exchanged by the property owner prior to the actual sale date of the tax deed. The property owner must pay the value of his tax lien certificate plus the indicated amount of interest owed to him. Also, the lower the value of the property, the more likely you are to get it.
Owning multiple tax lien certificates allows you a greater chance of getting one or two properties on your tax deed sale. Several states have an auction format on these sales – the highest bidding price gets the property. However, the current US economy is great for investors because there is less competition from other bidders than three years ago and there are many more properties in foreclosure for back taxes.
The price you will pay to obtain a property has both variable and fixed costs. For example, in Florida, each county tax collector charges between $ 225 and $ 240 to initiate a tax deed sale for each tax lien certificate. The Clerk of the Circuit Court for each county charges about $ 250 +/- to finalize the tax deed sale.
If the property is occupied by the property owner (he / she lives in the house), then the prospective bidder will have to pay half of the assessed value of the tax (usually a few thousand dollars) plus all costs (tax collector county clerk and clerk). of Circuit Court fees paid by you plus back taxes paid by you, the owner of the tax certificate), plus paying you an additional 18% interest on each payment of all your county costs to initiate the sale , plus all interest reported before filing for a property tax deed. Uninhabited (not owner-occupied) properties will not incur half the assessed value of the tax, but property taxes are typically much higher. You will get the property for around 2% to 20% of its value or you will get a very good return on your money.
