HOW TO MAKE MONEY BUYING TAX LIEN CERTIFICATES
Learn How to Make Money Buying Tax Lien Certificates. This is a safe investment that pays interest rates up to 36%, and it’s secured by real estate.
Earn high returns, or get a mortgage-free property for pennies on the dollar. Ted Thomas will show you how.
Watch the video above or read the summary below:
Today I’m going to answer the question, how to make money buying tax lien certificates. So kind of open up your mind; this is a new business for a lot of people, but it always works.
I’ve been doing this for the last 25 years, not only teaching it and guiding people, but I do it myself.
I like to buy tax defaulted properties because I make bigger profits. However, some people prefer the tax lien certificate because it’s predictable, it’s certain, and it’s secure.
Investors love these certificates. Everyone likes to make money, especially if you get checks from the government.
This is an investment, where you don’t invest with Ted or a broker or a company. You are going to invest directly with the county, and you’re going to get a check back from the county.
What’s going on is counties are sending notices of default to people who don’t pay their tax. When they don’t, they’re going to allow you and me to pay those taxes. If we pay someone’s taxes, they’re going to give us a tax lien certificate.
For the past 25 years, I’ve been doing this. It sounds simple, but the first time you hear about it, it sounds a little bit unbelievable.
About half of the counties in the United States sell tax lien certificates. They do that because property owners have defaulted, and they’re sort of giving the people a second chance. I’ll go into those details in just a minute.
Many people call me America’s Tax Lien Certificate and Tax Defaulted Property Authority. You’ll kind of see why as you go along.
I started out as an investor, just like you. Then I became a coach and a guide and a teacher, and now I’ve been teaching people how to do it for many years.
People can make a lot of money on tax lien certificates and tax defaulted property, and you’re going to see that it really works.
I have a gift for you. It’s absolutely free. It’s called Safe Haven. If you want to learn how to make money buying tax lien certificates, all the secrets are there. Also, you’ll learn about the big profits to be made with tax defaulted property.
HOW TO MAKE MONEY BUYING TAX LIEN CERTIFICATES – INTEREST RATES
The interest rates on tax certificates are not like the bank, where the bank goes up and down and so on. When you buy a tax certificate, you’ll know exactly how much you’re going to make.
They pay outrageous interest rates! So depending upon the state where you buy, you could earn 16%, 18%, 24%, 36%. I haven’t named all the states, but you’re getting the idea. You can earn a lot of money.
I’m standing here in Florida in a small studio. In Florida, these certificates pay up to 18%.
HOW TO MAKE MONEY BUYING TAX LIEN CERTIFICATES – FINDING A LIST
Now, where do you find out about the certificates? They advertise in the newspaper, and they’re also on the county website.
In the United States, we have about 3,000 counties. About half of those counties will sell tax lien certificates. When they do, they advertise it in the newspaper. They put it on their website.
HOW TO MAKE MONEY BUYING TAX LIEN CERTIFICATES – TAX LIENS
What’s really going on is that people haven’t paid their property tax.
The local government has already authorized the treasurer to levy a tax and to collect a tax. If they haven’t been able to collect it, they issue a tax lien certificate. A lot of good things happen then.
First of all, the tax lien certificate helps everybody.
It helps the community because you and I can give the community money to buy the certificate. So now the local government can pay the county employees, the police department, and so on.
As for the property owner who’s in default, we don’t know whether they’re sick, or if they lost their job, or what happened, but they didn’t pay the tax.
We leave the property owner there. They’re not evicted. They stay in the property. There’s no foreclosure taking place temporarily.
When we buy the certificate, we’re going to earn these generous rates of return. So everybody in the loop makes money.
HOW TO MAKE MONEY BUYING TAX LIEN CERTIFICATES – ACQUIRING PROPERTY
If the property owner comes in and pays the taxes, then you’re going to make a generous rate of return, 16%, 18%, 24%…
What if the property owner doesn’t pay? If the property owner doesn’t pay the taxes and buy back the tax certificate, you’re going to get the property without a mortgage. So think about that.
According to local governments, these people are going to pay you.
95% to 97% of these people will pay their taxes.
Right now, I want to remind you that there’s a gift. It’s a free gift from me to you. It’s a little mini course that will teach you how to make money buying tax lien certificates and will also show you how to make big profits from tax deeds.
It’s my free gift to you for right now, so be sure to get your gift today.
HOW TO MAKE MONEY BUYING TAX LIEN CERTIFICATES – COST OF A TAX LIEN
Some tax lien certificates are $50. Some are $500, and some are $100,000. There are all sizes and shapes of these tax certificates.
You’ll earn the amount of money that’s on your certificate. 18% is the highest in Florida. The most you can do an Iowa is 24%, and Illinois goes all the way up to 36%.
It’s a bidding process, and I’ll get to that.
HOW TO MAKE MONEY BUYING TAX LIEN CERTIFICATES – TAX SALES
So, how to make money buying tax lien certificates?
Well, first of all, you have to know about the sales.
You learn about them on a website, and you can also learn about those in the newspaper.
Once you know that, you need to get the auction rules. The auction rules are a must. If you don’t know the rules, don’t do any bidding.
HOW TO MAKE MONEY BUYING TAX LIEN CERTIFICATES – REDEMPTION PERIOD
When you buy a certificate, you give money directly to the county to pay someone else’s taxes, and that someone else is going to be given a time.
It might be a year. It might be two years. It might only be six months, but they’re given a time when they have to pay the tax.
Meanwhile, they let them stay in the property. You do not get possession. Keep that in the back of your mind. The property owner stays there.
They can live in the property, but hopefully they’re recovering from a sickness, and that’s why they didn’t pay. Or they lost a job, and they’re going to get another job.
HOW TO MAKE MONEY BUYING TAX LIEN CERTIFICATES – MORTGAGE-FREE PROPERTY
If they don’t pay, you will ultimately get the property without a mortgage.
They take the mortgage, and it’s wiped off. It’s just right wiped off the property.
At the county records, they just take that mortgage right off.
The people that have the mortgage, they still owe it, but it’s off the property.
You’re going to get the property without a mortgage. Wouldn’t that be a great deal?
I didn’t make those rules. The legislature did that. Then they have the county do all the the enforcement and the execution of that.
The Board of Commissioners isn’t who you’re going to complain to. You’re going to have to go complain to the tax guy, because the tax guys are the ones that do everything on these auctions.
All auctions are controlled by the Treasurer. So the Treasurer will write the rules, and you can buy the tax liens online or offline.
HOW TO MAKE MONEY BUYING TAX LIEN CERTIFICATES – A PASSIVE INVESTMENT
This is a business where you can sit on your rusty dusty, and you can make money.
With a tax lien certificate, if you buy one today and it pays you, you can reinvest in another one. When that pays you, you can keep rolling that money over.
If you did it in an IRA account, you wouldn’t have to pay taxes. You want to learn about those IRA accounts, so you don’t have to pay taxes. Otherwise, you will have to pay tax on the interest that you’re earning.
HOW TO MAKE MONEY BUYING TAX LIEN CERTIFICATES – COUNTY TREASURER
So the County Treasurer is the one that does all the work. They have power.
They’re a partner in the auction. They can change prices at the auction. They can levy tax, collect tax. If they don’t collect tax, they can actually confiscate the property. So you’re getting the idea.
When you pay the government, what happens to that money?
The money goes to the local Treasurer, then what the Treasurer does is divide it up, some to pay the police officers, some to pay the firefighters, some to pay the county employees. You’re getting the idea.
Some to fix the roads, some to take care of the schools. All the county’s bills are paid for with property tax.
If the county cannot collect, they’re going to seize the property.
How to make money buying tax lien certificates is you invest with the government, and you’re going to get a check back.
The county, more than likely, will tell you if you’ll ask, how much money you’re going to make. You’re going to make the amount of the certificate, and there’s a 95% to 97% chance you’ll get paid.
Understand that the property owner will not leave the property. They will stay on the property until the certificate expires, or until they pay you. Once they pay you, you have no more rights in the property.
If you don’t get paid, not to worry, you’re going to get the property, and you’re going to get it without a mortgage.
HOW TO MAKE MONEY BUYING TAX LIEN CERTIFICATES – TAX DEEDS
Now the tax lien states are not all. Florida is like a tax lien state. But you could go into the state of Georgia, and they don’t sell tax liens. They actually sell deeds in the state of Georgia.
Deed means the property is leaving the property owner’s hands and going into someone else’s hands. That’s a transfer. Isn’t it?
So the transfer takes place in those states.
About half of the states sell tax lien certificates, and the other half of the states are going to sell a tax deed.
HOW TO MAKE MONEY BUYING TAX LIEN CERTIFICATES – GETTING THE DEED
What is the process to get the deed to the property if the homeowner does not redeem a tax lien certificate?
Well, it’s probably going to be mostly automatic, but let’s say you have to do a little work.
The little work would be this. You didn’t get paid, so you’d notify the county that you didn’t get paid, then the county will do the rest of the work. They’ll tell you, “All right, we’re going to have to do a foreclosure.”
Some counties might let you do the foreclosure, but what they’re going to do is just a formal foreclosure and take the property away from them. That’s simply done with direct mail.
They send direct mail to the client and say, “Look, you have to leave the property. You’ve lost your right of ownership.”
In the United States, everyone is allowed to own property. It’s our privilege.
That means you could sell the property if you want. That means you could subdivide it if you want. You could put crops on it or build a house on it. You can do anything you want with it, however, you’ve got to pay property tax.
These people all know that because whenever they get in default, they send them a note and tell them the consequences. If you don’t pay, you’re going to lose the property.
So to get the property will require a foreclosure process.
HOW TO MAKE MONEY BUYING TAX LIEN CERTIFICATES – VACANT LAND
If you bought a tax deed on vacant land, what could you do with it?
I would tell you to know what the value is. If the value is $25,000, and you bought it for $1,000, you’ve got plenty of margin for profit.
I would sell it for $10,000 to $12,000 immediately because other buyers see all that that extra margin that you’re willing to give away. I like to buy low, and sell them low. So that’s very important to me.
I like to buy residential lots at auctions, because there are not a lot of bidders.
HOW TO MAKE MONEY BUYING TAX LIEN CERTIFICATES – MISTAKES TO AVOID
There are a couple of things you want to be careful of, two mistakes people make at these auctions that can cost you a lot of money.
Mistake number one is don’t buy any property that you haven’t looked at. Why? What if it was next to a chicken barn that had terrible smell? You wouldn’t want that property.
What if it was next to a railroad? Or what if there was a fire?
When you buy at the auction, you’re buying as-is. So if there was a tornado last week, you’re going to have a damaged property. So you need to look at it relatively close to the auction.
The second big mistake people make is they get involved in the auction, and they’re so excited about getting a property that they’re just going to buy something. So they keep bidding and bidding until they get something.
The object of the auction is to buy a property that has plenty of margin.
You don’t want to buy a property unless you already know what that margin is. In other words, you’ve got an exit strategy.
The exit strategy is just as important as purchasing the property.
Don’t buy a property unless you’ve looked at it, and you’ve already planned your exit strategy. Otherwise, you may pay too much, and then you’re in trouble.
We hope you learned a lot from Ted’s lesson, “How to Make Money Buying Tax Lien Certificates.”
These certificates are issued by local governments, and about half of those counties will issue tax lien certificates.
That simply means someone didn’t pay property tax. If you want to pay their tax, you can do that. You’ll pay the money directly to the county, and receive a check from the county.
Every state is mandated to collect taxes. Whether they do it with tax liens, or whether they didn’t do it with tax auctions.
The legislature of the state makes the rules, tells the county what to do, then the county treasurer levies the tax and tries to collect it. If they can’t collect it, what they’ll do in the tax lien states is issue a tax lien, and anyone can buy one.
Tax lien certificates pay outrageous interest rates, as high as 36%, and they’re secured by real estate. 95% to 97% of people redeem, and you receive all your money back plus the interest.
If they don’t pay, then you get the property mortgage-free.
Tax lien certificates are an excellent passive investment. You could buy one for as little as $50 or as much as $50,000 or more. There’s something for everyone.
Tax lien investing can be very profitable if you know what you’re doing.
There’s no one more qualified to teach you how to make money buying tax lien certificates than Ted Thomas, America’s leading authority, who is famous for showing students how to earn 6-figure incomes within a year of completing training.
Ted Thomas is the only one who offers full support, providing home study courses, live tutorials, workshops and web classes, Q&A webinar sessions, and personal coaching.
If you want to learn more about how to make money buying tax lien certificates, you can get started today for FREE with the Safe Haven Investor System course (a $197 value).
Safe Haven is 2 hours of streaming videos and a 100-page illustrated manual that teaches you how to make money buying tax lien certificates and tax deeds. So act now, and get your FREE Safe Haven course today.