HOW CAN I INVEST IN TAX LIENS SAFELY?
“How can I invest in tax liens and acquire wealth without risk via this lucrative and secure investment?” If you’ve ever wondered that, Ted Thomas is here to answer your questions.
Today Ted will discuss tax liens in detail, teach you how to avoid making mistakes, and he’ll also share an auction horror story with you and show you how you can avoid becoming that person.
Watch the video above or read the summary below:
In “How can I invest in tax liens?” you’re going to get a lot of surprises in this particular article.
Imagine investing money with little or no risk. Well, that’s what you do when you get involved in tax liens. They’re not only low risk, but you can make some pretty big money.
Now, how do you do that? Well, you do that by investing in your local county. I’m going to give you a lot of foundational materials so that you understand how to do that.
Tax lien certificates generate money, and I’m talking about high interest rates.
Local banks, low interest rates. 1% is kind of average today at banks across the United States.
With tax lien certificates, you could earn 16%, 18%, 24%. You can earn even up to 36% interest on a tax lien certificate.
WHY DO COUNTIES SELL TAX LIENS?
Why on earth are they selling these tax lien certificates? Well, first of all, there are about 3,000 counties in the United States, a little over that, and about half sell tax lien certificates.
The other half will sell tax deeds, and I’ll tell you about tax deeds in another article. We’re just talking about tax liens, which turn into tax lien certificates.
The local county needs to collect money from all of the property owners. The property owners owe a property tax, and they’re required to pay it. The challenge is they don’t all pay it on time.
So they get a tax bill, but they basically pay it when they want. So if they are late, what the county is going to do is charge them interest for being late. In other words, they’re going to charge them a late fee.
The owners of tax lien certificates are the ones that get those late fees, and I’ll go over that with you.
What the county is trying to do is collect the taxes all at once, so they can pay the firefighters; so they can pay the police department.
Let’s face it, they have to pay the county employees; they have to pay school teachers, you’re getting the idea. The county has a lot of bills to pay.
HOW CAN I INVEST IN TAX LIENS WITH THE COUNTY?
What the county does when they don’t collect the money is they don’t confiscate the property. Half of the counties actually sell the taxes to someone else. So anybody can go in and pay the taxes on a tax defaulted property.
If they put it on a list of tax defaulted property, you can find that in the newspaper. You can find it on the county website. You could take care of buying that tax lien certificate, and invest with the local county.
How can I invest in tax liens? Well, that’s what we’re going to learn about here. That’s what this article is all about, so I’m giving you a little bit of that foundational information.
Taxes must be collected. So that treasurer gets a notice from the legislature that tells him or her, you must levy taxes; you must collect taxes.
If you can’t collect them, you’re going to either have to issue a tax lien certificate, so the money will come in, or you’ll have to sell the property at auction.
So the counties are selling tax lien certificates, and you can buy them in any one of those counties I mentioned earlier. They will sell tax lien certificates.
When that certificate is issued, it will start a meter running, and the meter is adding up interest, whatever the maximum interest in that county is. It could be all the way up to 36%.
HOW CAN I INVEST IN TAX LIENS TO MAKE MONEY?
You can buy a certificate. You wouldn’t be getting possession of the property, but you’ll be getting a certificate that’s earning money. That’s what you want.
For example, in Florida, those certificates pay all the way up to 18%. So you’re going to be earning a percent and a half every single month on your money in a tax lien certificate. So that’s a pretty darn good investment.
As I said earlier, there are 3,000 counties across this country, and basically half of them sell tax liens, and half of them sell tax deeds.
With the tax lien counties, again, you don’t get possession, but you buy this certificate that earns you money.
HOW CAN I INVEST IN TAX LIENS SECURELY?
Now, when you buy this certificate, you invest directly with the government, not with Ted Thomas, not with a broker, directly with the government, and you collect your checks back from the government.
That makes it safe and secure because that investment is going to be protected by the local Property Tax Code. They’re super safe.
So if you’re wondering, “How can I invest in tax liens securely?” they’re secure. When you invest in the certificate, you now have the security of that property. What do I mean by that?
Well, I mean, it’s a secure investment. The county will tell you, if you buy a tax certificate, and the property owner never pays, you get the property, and all you paid was basically the back taxes.
HOW CAN I INVEST IN TAX LIENS AND GET PROPERTY?
Now, you’d want to buy property for back taxes. Some people say, “Ted, I don’t want to own any property.”
I get it, you don’t want it. But what if you ended up with it, and it cost you 2%, and it had no mortgage? You could sell it for 50 cents on the dollar, and it still has no mortgage. You can make yourself a bundle of dough.
How long has this been around? Tax lien certificates and tax deeds have been around for over 200 years. The county and the state, they just got together, and they figured out a system. That’s all I’m teaching you is that system.
Why do we even need them? Well, we need taxes, because it’s the only way we can pay for local government.
Let’s talk about that local government. The county has control of the county, so they’re going to require everybody to pay taxes in that county.
What do the taxes do? They pay for the police department, the fire departments, as I mentioned earlier. They also give money to the hospital, and they take care of the court system, you’re kind of getting the idea.
The county has a lot of responsibilities. So what are they going to do if people don’t pay tax? Well, 97% of all the people will pay their tax on time.
It’s that few percent that don’t, but the county still needs that money. They don’t have a big reserve. Since they need that money, what they will do is they’ll issue a tax lien certificate.
HOW CAN I INVEST IN TAX LIENS FOR LUCRATIVE RETURNS?
For you, this is a secure certificate. It’s a secure environment that you’re investing in, and it’s very, very lucrative. Now it’s little known, but it’s highly lucrative. You can make a lot of money.
Do you just go out and buy any certificate you see on the list? No, you need to take a look at that property. Just because it’s a tax lien certificate does not mean that it’s perfect. You need to go and look.
What if it’s on a property that’s next to the local dump? Are you going to want to buy that tax lien?
Just keep in mind, if the people don’t come in and pay, you’re going to get that property. Do you want one right next to the dump? Probably not.
HOW CAN I INVEST IN TAX LIENS AT AUCTIONS?
Let’s learn a little bit more about these auctions. The auctions could be big auctions or small auctions. They could be selling properties; they could be selling tax liens. I’m going to just give you a little story about what takes place.
Now, if you’re wondering, “How can I invest in tax liens at auctions?” pay close attention. I’m about to tell you what not to do.
Recently, I was at an auction in Los Angeles County. Now this is a big auction in Los Angeles. They had over 2,000 properties, and there were probably 1,000 bidders in the room.
Now imagine 1,000 bidders. It was chaos in that room while they were trying to sell those properties.
AN AUCTION HORROR STORY
Right next to me was a couple, and they kept bidding and bidding. They had a big bidder’s card, and they’d keep putting it up in the air.
Sure enough, on one of the properties, the first bid was accepted. Then they said, “And do I have a second bid? And do I have a third bid?” Well, the bidding just kept going.
Finally, it was going once, going twice, and guess what? The people right next to me, they got the property. They were overjoyed that they got the property.
Of course, the auctioneer read off their card number, told them that they were the winner, and told them to come to the front of the room and pay. You can’t leave the room until you pay.
If you do, you’re going to have a sheriff following you out because you’re not going to go there and not pay for it. You’re going to go there, and you will pay.
So the point is, they were overjoyed. They were so excited. Then when it settled down, and the bidding started again, the man turned to his wife and he said, “Gloria, let’s go see what we bought.”
Now think about what they just said. They had no idea what they purchased. Well, I didn’t know what they purchased at the time either. It wasn’t one of the properties I checked, but everything’s online.
So at lunch, I went on the WiFi, got on the computer, looked it up, and guess what? It was a burned out chicken barn, one of those long things that’s about an eighth of a mile long with hundreds of chickens in it.
Well, it had burned down, but it was next to four other chicken barns. You can imagine what the odor around that place is.
I don’t even know if that property was worth 10 cents, but I do know that they bid over $200,000. I think the property was worthless.
I’m sure when they got there, I didn’t go look, but I’m sure when they got there and found that burned out property that they were pretty unhappy.
HOW CAN I INVEST IN TAX LIENS KNOWLEDGEABLY?
You don’t want to be that person. You want to get yourself educated. The educated investors in tax liens and tax defaulted properties are the ones that make the money.
Now listen, you guys know, if you hadn’t met that lady, you’re probably not thinking about getting married to her, It’s not going to happen, right? And ladies, I know you would never marry a guy that you hadn’t seen.
It’s the same thing in the tax lien and tax deed business. You don’t want to buy into those prior to seeing the property.
So is it risk free? No. But the tax lien certificate business is, if you’ll just learn how to do it and get a little education. You’ll do fine because people make money continuously in this business, but you do have to do your homework.
HOW CAN I INVEST IN TAX LIENS FROM OUTSIDE THE USA?
Can you invest in tax liens from anywhere in the world? Well, online, yes, you can do that. However, you’ll need to be in a country that accepts American dollars, or your bank will take US dollars.
You have to do everything in English because that’s the only language we recognize in the United States. Everything is in English.
We currently have clients in the United Kingdom, all the provinces of Canada, Singapore, Bangkok, that kind of thing. So we do this in a lot of places, but not everywhere in the world, because you definitely have to have a US bank account.
HOW CAN I INVEST IN TAX LIENS? WE CAN TEACH YOU.
Do we have classes? Well, we definitely have classes. We have online class, and we have offline classes.
We have home study materials, and we have group studies. We actually take people to auctions. So we’re a complete service when it comes to tax liens and deeds.
All my people have been around me, my coaches have been with me, all of them for more than 10 years. They all have 10 to 15 years of coaching experience.
We teach a complete course for everybody that wants it. I’ve been doing this for over 25 years.
You can start small, and you can go all the way to the advanced level where someone will hold your hand and go to an auction with you.
HOW CAN I INVEST IN TAX LIENS AND AVOID MAKING MISTAKES?
Let me tell you about two mistakes. That one mistake is a critical one, and that is what I just mentioned. Don’t buy a property unless you’ve seen it.
I’m seeing that happen at auctions. People are coming to the auction, they haven’t seen the property, and they’re bidding.
What if there was a hurricane yesterday? Did it burn down? Was there an earthquake? I don’t know what could have happened, but you don’t want to buy a property unless you’ve seen it.
The second big mistake that you need to learn about and make sure you don’t do is, you don’t want to get to that auction and get all excited.
Someone will bid higher, and you won’t get that one. So you’ll get even more determined, and you’ll start buying properties that you don’t have an exit strategy for.
You don’t want to buy any property if you don’t know what you can sell it for. That’s your exit strategy. Don’t buy just for the sake of buying because you may bid way too high and not be able to resell it.
So a big answer to “how can I invest in tax liens?” is “always with an exit strategy in mind.”
HOW CAN I INVEST IN TAX LIENS? – SUMMARY
How can I invest in tax liens? You can do so at the county level in about half the states. Tax lien certificates are listed in the newspaper and on county websites and sold at auctions.
Interest rates on tax lien certificates vary depending on the locale, and can be as high as 36%.
How can I invest in tax liens securely? Tax lien certificates are secured by real estate, so you could even end up owning property for pennies on the dollar.
Is investing in tax liens a good idea? Absolutely! It’s a great idea, a wonderful passive investment, and can be very lucrative if you know what you’re doing.
If you’ve learned something today and would like to learn more, I have a nice home study course for you. It took a while to put all this together, but it’s called Safe Haven, and it will teach you a lot about tax liens and tax deeds.
Safe Haven normally sells for $197, but I’ll give it to you for FREE. It’s my gift to you.
Follow me on:
Share my blog here: