How much money do counties make at tax auctions?

The amount of money counties make at a single auction depend on the number of properties and the number of bidders.  When counties publish a press release about home much money the will raise at a tax auction, the numbers are usually based on every property selling for the minimum bid.

Every property certainly can sell at an auction, but it is optimistic to think that over 3,000 properties will go.

On October 5, Beaufort County, SC will hold its tax sale.  They have about 3,600 properties as of today and stand to make $5 million if they all sell.  That is a lot of money the county is missing out on in delinquent property taxes.  They probably will not sell them all because of the number available, but they will recoup a lot of the delinquent tax money from the sale.

Cass County, MI just held one of two tax auctions and sold all 26 properties and made $247,500 with 17 more properties coming up for sale in about a week.

The money doesn’t always go directly to the county directly.  The money is often divided up between the  school district, municipalities, and the county.  They all use the property tax money to function so the tax sales are important to them.

How much money counties make at tax sales is far less than if each property sold at market value, but they would rather sell it quick for what is owed rather then spend six months or more trying to sell each property individually for more money.  They want the property back on the tax roll.

To learn how you can invest in tax sales visit http://BankREOTraining.com

The first step is learning where to look for tax lien certificates.  There are two types of tax lien certificates available for investors to purchase.  The first type is through a tax lien auction.

Tax lien auctions are usually held once a year in a particular county.  The auctions are advertised in the local newspaper and on the county website if the county has a website.  If you are unsure where to look for the list of upcoming tax certificates, contact the county tax collector or county treasurer and they should be able to tell you where you can find the list.

More and more counties are choosing to hold online tax auctions rather than physical auctions at the courthouse.  This means that more investors have the opportunity to invest in tax certificates across the country without leaving home.

The downside to online tax lien auctions is more investors turn out for the auctions making them competitive.  The interest rates are often bid down significantly.

The best deals can be found at live auctions where fewer investors are willing to travel and in counties that do not have a website.  Most investors pass on counties that do not have a website, because there are plenty of other counties that have websites to make research easier.  This means that you could potentially be the only investor at an auction if you travel to a physical auction.

Before bidding on an auction whether it be physical or virtual, always read the auction rules and requirements.  In some cases you will need a form signed by the county before you can bid.  This means you need to prepare well in advance.

Some auctions also require deposits for each lien you want to bid on before the auction begins.  It is important to know the rules before starting.  It is also a good idea to talk to the tax collector about the auction to be sure you know all the fees involved and the rules, even if it is printed online.

The other type of tax lien certificate available to purchase are the county held certificates.  These are liens that did not receive any bids during the auction.  They usually can be purchased for the cost of the lien and fees and you often will receive  the maximum interest return.

The reason the certificates did not receive any bids could be for a number of reasons.  The county may have held a physical auction and didn’t have a large turn out. Or the lien may be for vacant land which has a lower possibility of redemption than a home would have.  What ever the case may be, you would still want to do your before buying the lien.

Learning how to purchase tax lien certificates can be fun and rewarding.  There is no other investment like it that is virtually risk free.  To learn more about how to purchase tax lien certificates visit http://BankREOTraining.com

This would include IRS liens and government liens.  When investigating the property always check the current liens on the property before purchasing.    This doesn’t necessarily mean that all other liens will be erased at the time of purchase from the tax auction.

For example, in Pennsylvania any lien that is filed after the judicial sale is not removed when you purchase from the repository sale.  This means that a Property Owner’s Association may have a lien on the property that is removed, but they can file another lien once the tax foreclosure proceedings have begun that will stay through tax auction.

This is why it is important to call the county and the owner’s association if there is one on every property.  Be sure to write down the date, time, name of the person, and what was said.  It may be good to even record those conversations so you will have them as a reference.

In Arkansas I called with the same questions three times, spoke with two separate people, and received three different answers.   This is why it is  a good idea to take notes and call more than once.

To find out exactly which liens are removed at a tax sale, call the county and speak to the person that oversees tax auctions.  Don’t just call once, call at least twice on different days.

For quality education on tax foreclosure sales visit, http://BankREOTraining.com

There are a handful of companies that buy tax deed properties in bulk and sell them to investors way below market value.  This was a profitable venture when real estate prices where on the rise, but with the downturn in the economy properties aren’t selling as much as they were before.

The companies that would buy several tax deeds, or Land Banks,  would often sell on eBay or offer training on how to buy the properties, but the real goal is to sell land to investors.  There was a prominent company that followed this type of strategy.  They sold a training course that briefly went over the tax deed and tax lien process, but they didn’t teach a person how to find, research, buy, or sell tax properties. Their goal was to overwhelm the investor so they would buy land from the company rather than buy land from the tax auction.

If you purchase a tax lien there is more you can do than wait until it is redeemed or foreclose.  Those are the more obvious choices, but following the same principle as with tax deeds you can actually sell your lien to somebody else.

You can find tax liens for sale on eBay and other sites, but what a few investors will do is form investment clubs.  In these “clubs” they offer the members discounts on tax liens and sometimes tax deeds.  The club organizers will purchase the liens and then sell them to their members advertising risk free investing.

This strategy is transparent because the club members know the organizer buys the liens cheaper, but they do all the leg work.  In most cases, they aren’t trying to sell them education that is intended to overwhelm them so they will give up on learning to do it on their own and buy from the organizer.

If you are ambitious there is a lot of money to be made in reselling tax properties after you purchase them.  However, there is also a lot of money to be made by holding the liens you buy and waiting for them to be redeemed.

For education on how to really buy and sell tax deeds and tax liens visit http://BankREOTraining.com

There are some websites that manage the auctions for multiple counties.  The largest site is www.Bid4Assets.com.  They have auctions for many counties in California, Idaho, and other states.  Most counties have their own website that manages their own tax auctions.

www.Publicans.com is another website that handles many counties in Texas, Tennessee, and others.  They are a law firm so tax auctions isn’t all they do.

To find out if the county you are interested in has online auctions you will need to contact the appropriate party.  This could be the county treasurer, tax collector, or clerk of the courts.  If you look under one department and don’t see the information you are wanting, check the other departments also.  If you still can’t find what you are looking for, contact the Treasurer and they should know where to direct you.

Once you found the website for the online auctions you will need to read their terms.  Some counties require registration at least a day before the auction.  Others want it a week before or the day of the auction.  Online auctions often require a deposit prior to bidding.  This deposit may be required for each property you are interested in purchasing.  In this case one deposit for five properties will not be accepted.  You would need five deposits for five properties.

If the county does not offer online auctions, be sure you know the requirements before making the trip to the courthouse.  Physical auctions usually don’t require a deposit, but they want payment immediately after the auction.  The method of payment typically accepted is cash or certified check.  Rarely do the accept credit cards.

If you are flying in or driving long distances, determine what time you need to leave in order to arrive at least 30 minutes early.  Some auctions will not allow registration once the auction has begun.  Give yourself some time for heavy traffic and unforeseen events that could slow you down.

If you want to learn more about how to prepare to go to a tax auction then please visit http://BankREOTraining.com

A tax lien is backed by the real estate the lien is against.  If the property is not worth the amount of back taxes owed, it is less likely you will get your investment back.  When you research the property, find out what the tax assessed value is on the property.

The tax assessed value is not the same as the market value, but it can give you a good idea of whether or not the property is worth the amount owed.

The next step is find out what the approximate market value is of the property.  To do that you can call a real estate agent and ask them or you can search real estate listings in that area and see what comparable properties are selling for.

Your main goal for tax lien sales to get a property that will be redeemed.

Tax deed sale due diligence is the same as tax lien due diligence, but more.  In addition to determining the value, you also need to be aware of the liens on the property.  In most state, all liens, excluding federal liens, are erased at the tax auction.

Check with the local jurisdiction to find out what type of liens are erased and what stays.  This is very important to know.  If there is an IRS lien on the property and you buy, you are now responsible for that lien.

The counties are required to notify all lien holders prior to the auction.  If one party is not notified properly they may be able to buy the property from you or dispute the sale.

The condition of the property you are interested in buying is important to learn.  If you are buying land, is the lot buildable or a steep slope.  Is the land swamp land? Is there debris on the property that will need to be removed?

If you are interested in a home find out if the it is livable.  There have been homes sold at tax auctions that already had a demolition order.

The goal of a tax deed sale is to own the property.  Don’t take chances or you’ll lose your shirt.  If you want to learn more about tax sale due diligence visit http://BankREOTraining.com

First off, what is the outcome you would like to see from your investment?  Do you want the lien to be redeemed or do you want to own the property?

If you want to invest and get paid off, then a tax lien is the way to go.  You pay the taxes and then put a lien on the property.  After a pre-determined period of time if the lien is not paid off, you have the right to foreclose on the property.  Most of the liens with homes are redeemed so you probably won’t have to worry about the foreclosure process.

The interest rate on tax liens varies from state to state, but don’t think that just because one state has a higher rate than another that the higher rate will be more profitable.  At tax lien auctions investors bid down the rate rather than bid up the price.  If the rate is 18% to start, it could get bid down to 5%.  Always check the results from past auctions if available so you will have an idea of what to expect.  With more counties turning to online tax lien auctions there are more investors bidding because of the simplicity of the process.

If you want to own the property, then you will want to buy from a tax deed auction or a redeemable tax deed auction.  A regular tax deed auction will give you title with in 30 days in most cases.  The redeemable tax deed auction may take six months to two years before you obtain the title, but cause the owner has the right to pay off your investment plus interest.

When you are goal setting for tax foreclosure investing, always know what will be your purpose of the investment.  If you don’t want ownership, buy a lien. If you do want ownership, by a deed.

If you are interested in learning the tax foreclosure investing process step-by-step then visit http://BankREOTraining.com