FOLLOW TED’S FIVE STEPS TO INVEST IN TAX DEEDS TO GET DEEP DISCOUNT REAL ESTATE
In 5 Steps to Invest in Tax Deeds, Ted Thomas reveals a little-known way to get real estate for pennies on the dollar and shows you an unconventional strategy to sell property quickly that really works!
Watch the video above or read the summary below:
Today let’s talk about tax deeds and the Steps to Invest in Tax Deeds, specifically Five Steps to Invest in Tax Deeds.
I started out with tax lien certificates. I liked tax lien certificates because they were safe and secure. What I did is I invested my money with the government, and I could get a check back from the government. It was a predictable way to make quite a bit of money. Then I slowly transitioned to doing tax liens…
I transitioned from tax liens to tax deeds, which simply means tax-defaulted properties. When the government wants to sell them, they actually sell you the deed.
Now, I’ve got a lot of information for you today, so let’s talk about the steps to get involved in tax deeds.
Just so you know, I’ve been at this for about 25 years, teaching people. I’ve been doing it myself for about 30 years, and I’ll give you some of those details as we go along today.
THE STEPS TO INVEST IN TAX DEEDS ARE SIMPLE
Tax deeds are available in all 3,000 counties. There are a few more than the 3,000, but every county will sell tax deeds. These are properties that the government has confiscated, and now they want to get rid of the property. They usually will sell them at very close to the back taxes.
This is really a simple process. It’s not difficult, but you’re going to have to get educated a little bit. I’m not going to recommend that you start tomorrow afternoon, run down to an auction, and start raising your hand at bidding.
You don’t want to do that. You want to educate yourself, get a little background, figure out where you are, what you want to do, and so on. And I’ll give you some steps to do that today. You might want to write them down as I go along.
Number one, this business is the world of the weird. All kinds of different things will happen. So first of all, I want you to understand this is a world of the weird, but next, I want you to understand that this is not going to be a difficult thing to do. Everybody’s going to be able to do it.
BEWARE, IT MIGHT SOUND A LITTLE BIT TOO SIMPLE
Just be a little on the cautious side. It sounds a little bit too easy. So if you’re watching late night television and someone says, “Oh, I just made a half a million dollars,” just be a little bit cautious and be a little bit disbelieving.
The business has been around for 200 years, and the reason it’s been around so long is it works for all parties involved. In other words, the first party involved is the local government. They want to get rid of the property. But the second party involved is you.
You want to buy these properties, but you want to buy them right so that you can resell them and make yourself some money, okay? This is a pretty safe and secure business. Understand you’re always going to do business with the local government. You’re not going to do business with Ted Thomas.
Ted Thomas is an educator. I teach people how to do it. I’m kind of a maverick, but I really have been involved in this for quite some time, so I’m going to give you a lot of great background information.
LEARN THE STEPS TO INVEST IN TAX DEEDS AND PROFIT
Now, when I say cautious, I don’t mean that I’m negative. I have students that make $10,000, $25,000, $50,000, even $100,000 on one deal. So it’s going to be relatively easy for me to teach you how to make $25,000 and $50,000. Will you do that by next Friday? There’s not a chance. You’re going to have to get educated. This takes a little while.
I have world-class coaches, and I don’t joke when I say that. All of my coaches are 60 plus years old. All of them have been involved in buying and selling tax-defaulted properties and tax liens and tax deeds. As a group, they have done over 200 purchases and resales of tax-defaulted properties. Think about that. So they’re at auctions regularly. They’re doing it.
Who do you want to learn from? You want to learn from someone that’s really doing it. I’ll get back into those coaches in a little bit.
Ask yourself, why are you doing it? What’s your why? Why are you here? Do you want to just make more money? Do you want to learn more about tax liens and deeds? What is your intention? Do you have some money to get started? If you don’t, you’ll have to attend one of my classes on how to generate some money.
Do you want to buy properties that you’re going to fix up? Do you want to buy properties that you’re going to sell quickly? How are you going to go about selling it? Have you ever thought about that?
Well, these properties are going to be sold to you at a local government auction. Once the gavel comes down and they hand you the deed, once all that takes place, it’s your property. You’re going to not only have to make sure it’s safe and secure, but you’re ultimately going to want to sell that property. So where are you going to do this?
If you live in Pennsylvania, are you going to do it there? Are you going to go to South Carolina? Maybe you’re going to go to California. Maybe you want to do Washington. Well, we’re going to teach you.
If you join my community, you’ll sure see people doing this, but you need be willing to do a little bit of research. We have daily classes on how to do research in my office. For our regular clients, they can attend those classes. You need to start thinking, are you willing to do research?
STEPS TO INVEST IN TAX DEEDS – WHAT TO DO WITH THE PROPERTY
Let’s talk about some of the steps. What we’re talking about today is tax deeds. Now you remember a tax deed is a document that transfers from the state or the county to you. That’s a deed. They’re going to transfer the deed to you, but it’s because you bought a tax-defaulted property.
Are you going to rehab it? Do you know how to do that? Are you going to do like I do? I don’t want to rehab those properties from time to time. I’ve had to do that, but I prefer to buy it low and then resell it. Let me say that again. I want to buy it low and sell it low.
Why do I do that? Because I looked at Walmart, and I looked at Target, and I look at companies that are like that, and what do they do? What they do is they buy it at the right price, and they get rid of it. If you go look at the parking lot at Target, or you go and look at the parking lot at Costco, what’s going on? Thousands of people are there buying. Why? Because everybody wants a deal.
So I figured out I’m not going to get the highest priced ones. I’m going to get one that I can get a good price when I buy it. I’m going to mark it up a little bit, and I’m going to move on to the next one. If you don’t know how to fix it up, you need to think about that for a little bit.
You’re going to buy these properties more than likely directly from the county. Many times, the county will give you a treasure’s deed, or they’ll give you what they call a quitclaim deed. If they give you a quitclaim deed, you need to read that quitclaim deed because they have basically disclaimed any liability on that property.
If you’ve got a property that nobody knows the history on, then you might have to check with the title company to see if you’re going to be able to sell it quickly. It doesn’t mean there’s anything wrong. It just means there’s another little piece of the equation that you have to figure out.
WHAT ABOUT THE MORTGAGE?
These properties that are sold at auction have no mortgage. So let me say that again. Let me elaborate on that. When a county auction takes place, whether it’s on a tax lien certificate or a tax-defaulted property, which is a tax deed, if a county auction takes place, they wipe out the mortgage.
Now you’re saying, “How can they wipe out the mortgage?” Well, they have rights to wipe out the mortgage.
So the legislatures tells them, “Look, if the property owner doesn’t pay, see if the mortgagor, or in other words, the banker will pay.” If neither one of those parties will pay, they just wipe out the mortgage, and then they sell it because the local government wants money. They have power.
I want you to keep in mind you’re dealing with the government. They have power to do these things. But the beauty of all of that is you buy properties without a mortgage. Just think about that. How would you feel if the house you lived in didn’t have a mortgage? You’d feel pretty good about it.
Let me give you some of these steps, and you can write them down if you like. Or you can come back and read the article again. So let’s give you some of the steps to invest in tax deeds.
STEPS TO INVEST IN TAX DEEDS – #1 GET A LIST
Step number one is you need to get a list. That list is going to be provided by the county, so you can find out how many tax-defaulted properties they have. Each state will tell you that they have many counties. These are always sold at the county level or at the municipality level.
STEPS TO INVEST IN TAX DEEDS – #2 LOOK AT THE MINIMUM BID
Once you have the list, then you want to look and see what’s the minimum bid. There’s no sense in you bidding or even dreaming about million-dollar properties if you don’t have the money.
If there are properties on there that you can buy for a starting bid of $20,000 and it’s worth $100,000, you probably want to go to the sale. But if the starting bid is a million dollars, you can’t go, so don’t waste your time on that one. Look at the ones that you can afford.
In many places, whether you’re in Houston, Texas, or whether you’re in Seattle, Washington, they will have literally hundreds of thousands. I’ve attended the auctions in all of these towns, even in Los Angeles, where the auction will take days to do because they have 2,000 properties. So there is going to be plenty for everybody.
This is a business of abundance. They’re never going to run out. This year nationwide, we have somewhere between 2 and 3 million tax-defaulted properties, yet 99% of the people don’t even know what we’re talking about.
The reason they don’t know is because they don’t know how to research the county records, and they don’t even know that all real estate data is public knowledge. Everybody can know. You can look up the properties in Los Angeles, or you can look up the properties in Kansas City and get to know them. And, yes, we have classes on that.
STEPS TO INVEST IN TAX DEEDS – #3 EVALUATE THE PROPERTY
So how are you going to evaluate the property? Well, if you didn’t do anything else, you could walk up and down the street and ask people what’s the value of these houses.
Or could you call a broker, and they could tell you by looking through the multiple listing service? Or could you go to Craigslist? Or couldn’t you go to eBay? Or there are just auction sites that you can look at. My point is there’s plenty of information for everybody.
This is a business that if you’re a do-it-yourselfer, you certainly can do that. Do I recommend it? I would tell you if you want to do it yourself, go ahead, but it’s probably going to take you about two years to learn how to do this. We can do the same in less than a year, and you could be a mini expert on it. But that’s what our business is.
STEPS TO INVEST IN TAX DEEDS – #4 KNOW YOUR EXIT STRATEGY
Let’s talk about step four. And step four is what’s your exit strategy? I always tell people the biggest mistake is that they haven’t looked at the property. But the second biggest mistake, the number two mistake that people make is they have not thought about what they’re going to sell it for.
If you’ll think about what you’re going to sell it for, then you’ll buy it at the right price. Unfortunately, people buy property at the auction. They hear about an auction that’s good, so they go and raise their hand real quick. They’re going to buy that property. They buy it. They pay too much money, then they find out afterwards they paid too much.
If you can’t sell it now, what are you going to do? You’re going to have to take a loss on the property, and it doesn’t make any sense. You always want to make sure that you know what your exit strategy is going to be so you can sell it quickly.
If you’re going to fix it up, that’s a cost. You want to think about that. Holding costs, you’re going to have to pay taxes; you’re going to have to pay insurance. So you need to think about those things. So let’s move on to step number five.
STEPS TO INVEST IN TAX DEEDS – #5 SELL
You own this, folks. Nothing happens until you sell it. You don’t want to hold on to that property. You do not want to hold on because properties will deteriorate. They need paint; they need cleaning; they need the lawns cut. They need the water taken care of. There are a lot of things to take care of. So you want to buy and then you want to quickly resell.
What we’re really talking about today is we’re talking about buying tax deeds. That means when you buy a tax deed from the county, you bought a tax-defaulted property. The government has already confiscated it. They’ve already seized the property, and they just want to sell it.
Now, why did they want to sell it? They simply don’t want any more property. They can have as much as they want, and they don’t want anymore. Instead, they want the tax dollars. They need the dollars so that they can get paid. I hope you’re getting the idea.
Are you going to hire a broker? You going to put it on Craigslist? You going to put it on eBay? What are you going to do? You need to think about selling it.
What about research? If you don’t know about research, we have classes every week on researching in my office. You can attend those classes, and we have coaches that can teach you about research. It’s really, really important.
Maybe I didn’t do this thoroughly, so I’m going to say it again now. I have what I call a Walmart strategy. It’s really easy. You could call it your Target store strategy or your Costco strategy. All I learned from those big guys is if I’m going to buy stuff, I want to sell it. What do they do that they’re so successful?
When you go there, their parking lots are always full. Why? Because they buy it low, and they sell it low.
What you’re after in a business is margin. You want some margin. If you could buy a $100,000 property and get it for $20,000 or $30,000, you’ve got a lot of margin.
At these tax-defaulted auctions, you can buy low sometimes 10 cents, 20 cents on the dollar. I’ve seen properties even less than that. When you get those properties, there’s no mortgage. So now you’ve got some margin to sell it, and that’s the whole key. That’s what I call my Walmart strategy.
By following the 5 steps to invest in tax deeds, you can pick up properties as a deep discount. Get a list, look at the minimum bid, evaluate the property, know your exit strategy, and sell – it all sounds so simple, and it is, but you also have to know what you’re doing.
You don’t want to make a costly mistake or waste time searching for information that could be at your fingertips if you just knew where to look. I’ve been buying tax deeds for 30 years and teaching for 25 years, so I can show you.
Why not join my community and you can learn a lot more? As a matter of fact, if you’re not already a member, I’m going to offer you a gift. This is free. The gift is a streaming video course. Part one is all about tax lien certificates, and part two is what we’re talking about today, tax deeds.
If you want to get more of a background on the steps to invest in tax deeds and see people doing it, go to tedthomas.com/safehaven to get your free course valued at $197.
Follow me on:
Share my blog here: