Tax
Foreclosure Properties - What They Are, and How to Buy Them
By Maggie Dawson
Everyone who owns a property must pay taxes on it each year. If the owner
doesn't pay his or her taxes, the property's status becomes delinquent.
Fees accrue, and further taxes continue to pile up as time goes by. If the
property isn't brought current within a specified period of time, which
differs state by state, then the property will eventually be foreclosed
upon and sold at auction by the county in which it's located. These tax
foreclosure properties provide a great opportunity for savvy real estate
investors.
There are several reasons why tax foreclosure properties are better
investments than mortgage foreclosure properties, but the biggest is that
they are almost always free of mortgages by the time they reach the sale.
Mortgage companies will bail out the back taxes on properties they have an
interest in long before they get to the point of government foreclosure.
Since houses without mortgages are often also houses without other liens,
the equity is up for grabs if you're lucky enough to buy one.
You've likely seen infomercials recently claiming you can make
thousands by investing at the tax sale. They're only half right. The other
half is blatant exaggeration to try to get sales! Tax foreclosure
properties are a great investment, but you'll have to avoid the tax sale
to get the best deals. Competition at tax sales is fierce, and often the
little guy can't compete with the tax investing giants that go after the
best properties.
The way to get these properties is by waiting until time is running out
for these owners- this is usually during the period AFTER the tax sale.
Most states give owners a year or so to "redeem" their property after it's
been sold at tax sale. When that period of time is up, there is no
recourse- they have lost their property permanently. So by waiting until
shortly before that redemption period is up, and then contacting the
owners directly, you'll be catching them at a time when they're highly
motivated to sell their property to you for a steep discount. Sometimes,
these owners have resigned themselves to losing the property, and are just
happy to be selling it to someone other than the government.
After you've purchased the property directly from the owner? You just
pay off the delinquent taxes and fees, and the property is yours.
Few investors exploit this route. Why? Could be because it's more work,
but it's more likely they just don't know where to begin. If you're
willing to put in the time and effort to find these people, you've just
discovered a lucrative way to invest in free and clear real estate... with
next to NO competition.
Click here for more
info on this investing method- including how to obtain or compile your own
list of properties about to be lost to tax sale in your area or anywhere
in the country, and how to find their owners.
Also, learn what to say to an owner when you talk to them on the phone,
to "grab their deed" for
as little as $10! (Yes, really!)
M. Dawson is a Chicago area writer, real estate investor, and
entrepreneur.
Article Source:
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