Investing in Property Tax Liens – Is Buying Tax Liens a Good Investment?

Safe Investing in Property Tax Liens

Investing in Property Tax Liens is one of the safest ways to earn high returns. Where else could you get up to 36% interest secured by real estate?

Additionally, tax liens are a great addition to a pension plan. So why hasn’t anyone else told you about this?

I’ve been involved in investing in property tax liens, and tax deeds, for about 25 years. Times have really changed, and I’ll tell you about that as we go along.

So I’m going to talk about investing in property tax liens and making money with tax lien certificates.

There are thousands of ways to make money in the United States. I’m just going to show you a couple right now that will really work for you.

This is a highly lucrative little-known investment. Once you learn how to do it, you can do it in hundreds of counties across the United States. You can do it online, and you can do it offline.

I’m going to show you how to make money in different states, in different counties.

Then I’ll tell you about two mistakes that you need to avoid, so that you don’t get into trouble at the tax defaulted auction. I see people making big mistakes there, and I’ll show you what to avoid. So stay with me.

As for investing in property tax liens, I’m qualified to teach you this because I’ve been involved in this, guiding people and teaching people, for over 25 years.

There are 3,000 counties in the United States. It’s over that actually. It’s about 3,200. Half of those counties sell tax lien certificates. The other half sell tax deeds.

What Are Tax Lien Certificates?

Let’s concentrate on these tax lien certificates. Here’s what happens.

In the event someone doesn’t pay their taxes, and let’s say they’re in Orlando, Florida, well, the local government’s got a problem now because they’ve got a lot of bills to pay. I’ll come back and talk about that in a minute.

So the government has a problem. What they’ll do is send notices to the property owner and say, look, you’ve got to pay your taxes.

The people still don’t pay. They either default, or they refuse to pay the taxes, or they don’t have the money.

Any one of the counties there, whether it’s Seminole or Orange County or Osceola County, whatever the county is, they will then issue a tax lien certificate, which is nothing more than a piece of paper.

That piece of paper will say, for example, the tax on this property is $2,000.

Anybody that wants to pay it, can pay it. Then what the county will do is give them a position on that property where they’re guaranteed to get paid, or they’ll get the property.

So what’s the guarantee they’ll get paid? Well, in Orlando, they can pay up to 18% interest.

Some counties pay 16%. In other states, some counties, like in Chicago, pay up to 36%.

So you could earn this generous amount, this outrageous amount of money, on a tax certificate because someone didn’t pay their tax.

Florida is a very benevolent state. All tax lien states, in my mind, are benevolent. Because they don’t throw the people out of the property, when they don’t pay taxes. They do not throw them out.

The Power of Investing in Property Tax Liens

When you buy a certificate, you don’t get possession, but the certificate has power. What kind of power does it have? Ifthey don’t pay you, then you have the power to take over the property.

power of investing in property tax liens

Here’s what happens. 97% of the people will pay their tax. They’ll pay not only the tax that was due, but they’ll pay a high interest rate. Why? Because basically, you lent the money, and in Florida, it’s up to 18%.

Those certificates are available, in every Florida county, 67 counties. There will be over a million certificates available in just Florida alone. Think about how much money you could earn.

If you put money in the bank, it would be a nice solid 1%, wouldn’t it? Or maybe even less nowadays, and that’s not going to help you very much.

What if you could earn 18 times that by buying a tax lien certificate?

Maybe now you’re saying, “Well, wait a minute, Ted. Why do I want to buy somebody’s defaulted taxes?”

Here’s why you want to buy some defaulted taxes. Because if the people don’t come in and pay you, you are going to get paid by getting the property.

When you buy a tax certificate, you now have rights. You have rights in that property.

The property can’t be sold, can’t be mortgaged, can’t be traded. Nothing can happen on that property until you’re paid.

Here’s an example. You go in and pay, or you do it online, a $2,000 tax on somebody’s property. That would be a pretty nice property. It would be worth more than $200,000.

So you got a nice clean property, no junkers now, but a nice clean property. Sure enough, you’re paid the tax.

If the people ultimately don’t pay you, you will get the property. That’s the rules.

200 Years of Investing in Property Tax Liens

The rules have been that way for 200 years. I didn’t invent tax liens or tax deeds. They were invented by local governments and the state in cooperation.

The state and the local government got together and said, look, we have to take care of fixing the roads and paying the county employees. We have to pay the police department, the fire department, etc.

So the local government has a lot of bills to pay, and that all comes from property taxes.

Investing in Property Tax Liens as a Passive Investment

Investing in property tax liens is investing in tax lien certificates. That’s what you’re actually going to buy. You’re going to buy someone’s lien.

Now the county can run the county because they’ve got money. Then you just sit at home, passively on your rusty dusty, doing no work. You sit on your butt doing nothing.

95 to 97% of the people will come in and pay. When they pay, you’ll get all your money back. Let me say that again. You’ll get all your money back. And in Florida, up to 18%.

Now let’s travel around in our mind just a little bit. If you did the same thing on Long Island or Suffolk County, you’d get 12%. If you did it in Iowa, you’d get 24%, you’re getting the idea.

Investing in Property Tax Liens in Illinois

In Chicago, Illinois, or all of Illinois, they pay up to 36%.investing in property tax liens in Illinois

I’ve gone to the auction, in Cook County, in the old days. When they had the auction, they’d take out a three by five card, read the property number, and take a bid.

If they had 100,000 properties, it would take them 35 days to read all the cards.

Well, they don’t do that anymore. Now they do it online. You can do this online, and never have to go to an auction.

So I don’t care what state you’re in. If you’re in Orlando, Florida, and you want to buy a property in Seattle, Washington, you can do that, because we teach this whole thing online.

Alright, quick review. We’ve got 3,000 counties. Half of them sell tax liens. The others sell tax deeds.

The homeowner is in trouble and hasn’t paid the tax. You’re going to pay the tax in a tax lien state.

They’re not going to kick the homeowner out, and you’re not going to get possession of the property. As I said, those are very benevolent states that don’t throw people out.

Tax Liens Vs. Tax Deeds

Other states, like California and New York, are tax deed states.

I can tell you right now, the treasurer will seize the property. They will evict the owner, and they’ll sell the property to the highest bidder at an auction. Those property owners are thrown out of there immediately.

So there’s a world of difference between investing in property tax liens – a safe, secure, and easy to understand investment.

You can’t give Ted any money. You invest with the county, and you get checks back from the county.

This system has been around for 200 years. It’s been perfected. Anybody can do it. You can learn how to do it. Once you do, you can do this for the rest of your life.

Investing in Property Tax Liens in Your Pension Plan

It’s not unusual for people to buy tax lien certificates in their pension plan, or buy them in an IRA, or a traditional IRA and even a Roth IRA. You could do it in either one. It’s going to be up to you. There’s plenty for everyone.

Just in Florida, there will be 1 million certificates available each May. They will sell those certificates for varied interest rates. You’ll have to learn that, and they sell them in different counties.

Investing in Property Tax Liens Online

You could sit at home and do this, investing in property tax liens and deeds online. You can now finally make money and get checks from the local government by just working with your computer.

I’m going to tell you about some real big problems people have at auctions in just a minute.

Before I do that, I want to make sure that you understand that these tax lien certificates pay 16% in Arizona, 24% in a place like Iowa, 36% in Illinois. It just depends upon what state that you’re going to buy it in from wherever you are.

No matter where you’re investing in property tax liens, you’re always going to invest your money with the government. You’re going to get your money back from the government.

Investing in property tax liens is predictable. It’s certain, and it’s secure.

Acquiring Property Via Investing in Property Tax Liens

So you’re paying someone else’s taxes because if they don’t pay you, you’re going to get the property.

You’re saying, “Ted I don’t want the property.”

Well, I understand you don’t want the property. But if you paid taxes, and you only paid 1% or 2% for the property, would you like to have a property for 1% or 2%?

Certainly, you can call a broker and sell it for 25% or 50%. Because these properties always come without an auction.

So why do I do that? I’m going to be willing to buy tax certificates, because the government’s got my back. If I don’t get paid, they’re going to award me the property. I’ll take that any day of the week.

A common question I get is where does your money go? Well, it doesn’t go to Ted Thomas. I’m an educator, and I teach people how to do this.

What you’re going to do once you learn this, and we’ll teach you all the steps to do it, is you’re going to invest in your local county. Whether you do it online or offline. You’re going to invest with them.

They’re going to hold your money. It’s going to be protected by the property tax code.

When the people come in and pay their tax, you’ll get all your money back plus that high interest rate. That’s a great deal.

Why No One Told You About Investing in Property Tax Liens

Maybe you’re wondering why nobody else has told you about investing in property tax liens? Well, we’re in America. Everybody that’s in America wants to make money, and they want to make a lot of it.

Brokers get commissions. People that are financial planners, either get commissions, or they get fees. Attorneys get paid by the hour.

None of those people are going to tell you about investing in property tax liens, because they don’t get paid to tell you about it.

If you want to go buy a stock, they’ll be happy to talk to you about the stock because you’re going to have to pay commissions.

The point is, all of these people are commissioned people, and their commission is based on telling you information. If nobody tells you anything, then you’ll never know about it. That’s why you don’t know about this.

Mistakes to Avoid When Investing in Property Tax Liens

There are two things I want you to be careful of that I think are very important.

Number one, when you’re at the auction, you do not want to buy a property that you haven’t looked at.

If you haven’t had boots on the ground, and you haven’t had a chance to look at it, or pay someone to look at it, or have someone you trust look at it, you don’t want to buy it.

Because for all you know, it could have been in a hurricane, or it could have been in a fire.

Let’s face it, ladies, you wouldn’t marry a guy if you hadn’t seen him. It’s the same thing with real estate. Don’t buy it unless you’ve seen it, same deal.

The reason I tell you that is because I don’t want you to lose money.

There’s also another thing you want to be cautious of. You don’t want to end up at the auction, buying properties if you don’t have an exit strategy.

If you’ve got an exit strategy, you’re in great shape. If you don’t, then don’t start bidding, because I see people overbid. They bid more than the property is worth, and that could be a disastrous mistake for you.

In Conclusion

Investing in property tax liens is a safe, certain and predictable way to make excellent returns on your money. You can earn interest rates up to 36%, or even acquire a nice property in a good neighborhood for pennies on the dollar.

If you’re concerned about your retirement, not only can you make high returns from investing in property tax liens, but you can buy tax liens in your pension plan.

Tax lien certificates are a little-known investment, but that’s only because there are no middlemen making commissions off of it.

If your broker or financial planner can’t make a commission from it, they have no incentive to tell you about it. That’s why most people have never heard of investing in property tax liens, but now you know.

Now you know how lucrative it can be to invest in tax liens if you know what you’re doing.

So I’d like to get you started with a great course that I think you’ll be interested in.

If you’ve learned a lot, and you want to learn more, I have what I call a Safe Haven. That’s the name of the course, and it will teach you about investing in property tax liens and tax defaulted properties.

The Safe Haven course normally sells for $197, but I’ll give it to you for FREE.

All you have to do is click here and you can get started today.

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Ted Thomas

Ted Thomas is America’s Leading Authority on Tax Lien Certificates and Tax Deed Auctions, as well as a publisher and author of more than 30 books. His guidebooks on Real Estate have sold in four corners of the world. He has been teaching people just like you for over 30 years how to buy houses in good neighborhoods for pennies on the dollar. He teaches how to create wealth with minimum risk and easy-to-learn methods.

The Ted Thomas Difference:

  • Ted is recognized as America’s Tax Lien Certificate & Tax Deed Authority and has been helping people with investing in tax defaulted properties for over 30 years.
  • Ted has built a team of certified coaches that have 70 combined years of auction experience and are available to his students by phone to guide and mentor you to avoid getting overwhelmed or worse, losing money
  • Ted has ironclad PROOF that what he is teaching you does work. With hundreds of successful students providing testimonials and a 4.9 Google rating which is unheard of in this industry.
  • Ted and his staff don’t hide behind a website; they can be reached during office hours at 321-449-9940.

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