Back taxes homes for sale are in every state and are easy to find.
Local governments around the United States are serious about collecting the revenue they need. They do this through property taxes. When those taxes are not paid, then back taxes homes for sale is the result.
Can you buy a house by paying the back taxes? Yes, this is real. It is legal. It’s done regularly.
Reporting for CNN Money, Les Christie says, “When homeowners don’t pay property taxes… local governments have less money to maintain services like schools, police and fire departments and road maintenance. By selling tax liens, those governments can collect on what it is owed.”
There are two kinds of tax sales, a lien and a deed. I explain them in detail here. What’s more important than knowing what kind of sale is held, is knowing when the sale takes place, how to bid and how to invest in back taxes homes for sale.
With this kind of investing, sometimes you wind up with a house. Sometimes you wind up with a tidy profit on your investment because the homeowner redeemed the taxes.
In either case, if you pay attention to what you’re doing, you make a healthy profit. This kind of sale covers homes, condos, businesses and vacant lots. To make things simpler, I’ll just use the words house and home. Let’s take a look at how this is done.
Want to learn how you can make big profits with tax delinquent property investing? Would you like to buy homes for pennies on the dollar? Or earn interest rates up to 36% secured by real estate? Then you won’t want to miss this FREE Mini Class!
BACK TAXES HOMES FOR SALE AT AUCTIONS
All these sales are auctions. Some are done in person. Some are done online. If you’re not sure what kind of sale your community has or how to find tax delinquent properties in your area, the local tax office can tell you.
If you are interested in investing in other communities, there are websites which can help find auctions.
Some delinquent property tax auctions require you to register ahead of time. Some sales just require you to show up. Regardless of how the auction of back taxes homes for sale is held, you have to attend the auction, virtually or in person, in order to bid.
If it’s an auction you can’t attend, if you can find someone you trust who can attend the sale, let them bid for you.
You’re going to need the money to pay for your bid at the end of the auction for in-person sales. Online events may allow you a couple to days to get the money to the tax office. Some might require you to wire it to the office.
GROUP INVESTING IN BACK TAXES HOMES FOR SALE
A lot of people wonder if they can pool their money. Absolutely. Just make sure you pick one person to handle the bidding and you all agree on what to do with the property, if you get it.
Put this in writing. If the taxes are redeemed, then the profits can be split according to who invested how much.
OWNING THE PROPERTY
If you wind up with the house, there are several things you can do with it.
• Sell it. You bought it for a fraction of the fair market value. You can sell it below the market price and still make a profit. You can list it with a real estate agent and sell it. The next door neighbors may be interested in buying it from you.
• Rent it. The rental market is lucrative. A lot of people make a living as landlords. People need a place to live and not everyone can buy a house. Not everyone wants to buy a house. This does mean you have some long term maintenance responsibilities.
• Combine the two. Some people want to buy a house, but can’t get a conventional mortgage. So, you sell it to them on an installment plan and act as the mortgage company. You get a regular income and profit, and they have all the responsibilities for maintaining the property.
DECIDE HOW MUCH TO INVEST IN BACK TAXES HOMES FOR SALE
As with every kind of investment, there is some risk attached to purchasing back taxes homes for sale.
The risk is not repercussions from paying off the back taxes. That’s as guaranteed as anything. States need to make absolutely sure that buying back taxes homes for sale is safe because they need people to invest to collect the taxes. If it were risky, people might not do it.
The risk comes from the house you are buying. There’s no real way of knowing what the interior is like, but when you consider that you are buying it for a tiny fraction of the full value if the house in good shape, it’s a worthwhile opportunity.
Look at it this way. If the risk, even in getting a bad house, was that big, the government would take even more steps to make this kind of investing more secure.
We hope you enjoyed this lesson on purchasing back taxes homes for sale.
If you’d like to know more about how to get the best bargains in real estate, there’s no one more qualified to teach you than Ted Thomas, America’s leading authority on tax lien certificates and tax defaulted property investing.
Ted Thomas is a Florida-based author and publisher who specializes in tax deed and tax lien investing. Ted is the only one who provides full support and complete training with home study courses, Q&A webinars, live tutorials, workshops & web classes, and personal one-on-one coaching.
If you’d like to learn more about investing in back taxes homes for sale, which are sold at public auctions for 10, 20, or 30 cents on the dollar, or learn the secrets of tax lien investing to earn returns of 16%, 18%, up to 36%, then get started today with the FREE Master Class.