Tax Defaulted Property Investing – 7 Things You Need to Know

Investing in tax defaulted property can be profitable and easy. Before you begin, you need to understand how the process works, what to expect, the terms used in the business and what you have to do in order to be successful.

An Overview Of Tax-defaulted Property Auctions

property taxTax defaulted property auctions are held throughout the nation so unpaid property taxes, owed to local governments, can be collected. Every county holds auctions, but every county and every state has different rules. You have to know the rules to be successful.

My website explains in detail what you need to know to be successful investing in tax defaulted property. Training videos, articles and podcasts from experts in this industry tell you everything. You can listen, read and watch as often as you need to.

Want to learn how you can make big profits from deep discount real estate? Would you like to buy homes for pennies on the dollar? Or earn double-digit interest rates? Learn how to secure your financial future with this FREE mini class today!

Here are seven things you need to know about tax lien certificate and tax deed investing .

1) Decide How Much To Invest – How Much Do You Need?

This is a personal decision. You have to decide how much you have to invest. You can get started in tax defaulted property investing for as little as $100.

Many start buying tax lien certificates with just a few hundred dollars, while buying tax deeds at a tax defaulted property auction often requires thousands of dollars.

2) Decide Where To Invest – Not All Counties Are The Same

Every state and every county have tax defaulted property sales. Pick a state and then look for a county. Texas has 254 counties, each with its own tax defaulted property auction rules. You need  to know the rules for the county you are researching.

The Williamson County, Texas, property tax division website explains the rules for auctions there. Williamson County uses a law firm, McCreary, Veselka, Bragg & Allen, to handle the auction.

One example of a local rule is “bidders must be present at the tax sale. Bids will not be accepted via mail, phone or internet,” says the County’s website.

Travis County, Texas, allows bids by mail or hand-delivered. Bidders also have to fill out a bid form. You can find more information about Travis County tax sales here.

The differences between these two Texas counties show why you must understand the rules for each county you plan to purchase in for tax defaulted property auctions. Once you decide where to invest, contact that county’s tax office for county-specific information.

3) Find A Tax Sale Property List

tax defaulted propertiesAfter you pick a county to invest in, get the list of available properties. Tax defaulted property must be advertised in a local newspaper before the auction. Each state has public notice a website operated by the newspaper association there.

Florida has Florida Public Notices. Every tax defaulted property auction notice in the state is listed here. You can search by newspaper name, dates and keywords.

Say you want to invest in Leon County. Choose Leon County in the search area. This gives you all the Legal Notices as published in the Tallahassee Democrat newspaper for that time frame. You can shorten the results by adding the keyword “tax.”

Once you get the list of properties, you have to research them.

4) Research If The Property Is Worth Investing In – What To Look For

This is a very important step. You have to know if the property is worth buying. The Internet has many tools to help you do property research.

My website explains how to check out property. One video tells you how to use real estate websites like Zillow. If you plan to invest in other states, you must know how to use this website.

You can also use various street view programs to get a look at the property. Google Earth provides a bird’s eye view and often a street level view. You can also look at the neighborhood with this program.

Some things to check for:

  • Exterior paint
  • Intact siding
  • The roof
  • The yard

Are all these in good shape and well-maintained? Does the house need work? Work doesn’t mean the house is a bad investment, but you should have an idea of how much work will be needed.

You also need to find out if there are other taxes or liens owed on the property. The local tax office can tell you this. This needs to be a part of your budget. If you don’t pay those other taxes, someone can buy the property away from you at a future auction.

5) Register For The Tax Sale Auction – Research County Auction Rules

Every county can have different rules for its auctions and every state has different rules.

Orange County, California, has a Frequently Asked Questions (FAQ) page that tells you how to register for the auction, pay for anything you buy and what you have to do after buying a property.

Orange County requires someone to be at the auction in person. “The public auction requires your presence, or that of your representative, to verbally bid on the properties. Anyone wishing to bid on tax sale properties being offered the day of sale must be registered prior to bidding,” the website says.

San Bernardino County, California, conducts its tax defaulted property auctions online. You must register.

“To be eligible to bid at an auction, you must first register online. Registration is free and you do not need to register solely to view an auction, see results or research property. Bidders must register using proper names,” the instructions page says.

6) Show Up To The Auction!

how do property tax auctions work2All your work won’t matter if you are not at the auction. You must be there in person, or someone representing you is there. If the auction is online, you will need to login to the auction website.

If you don’t get a property, don’t worry. These auctions are held around the nation. Every week, many tax defaulted property auctions are held somewhere. Texas has 254 counties, sales are held in most counties every month in Texas.

7) What To Do With Your Winning Bid

You have to send in the payment and you have to fill out whatever paperwork is required for that specific county.

Wakulla County, Florida, also has an FAQ page for tax defaulted property sales.

It says, “Once the sale is over all successful bidders will be required to come into the Clerks Office Recording Dept. and post their cash deposit. Each successful bidder will be dealt with on an individual basis. At that time the successful bidder will be given the total amount due. This will include; the successful bid amount, documentary stamp fee’s, recording fees, and any other applicable fees. All fees are due and payment is expected by 4:00 p.m. the day of the sale.”

You have to complete the process. Many counties, like Wakulla County, Florida, will bar you from attending future auctions if you don’t do everything to close the sale. In Wakulla County, you also lose your deposit.

This is just a brief rundown of the things you need to do to be successful buying at a tax defaulted property auction. We can teach you in much greater detail how to research property.

When you invest in tax lien certificates, most often the government agency that sold the certificate will collect the taxes from the delinquent taxpayer and send you a check for all your investment plus interest within a few months to a couple of years.  If you obtained a tax deed you have one more vital step: SELL.  Selling will be covered in another article.

Ted Thomas is a Florida-based author and publisher who specializes in tax defaulted properties. Ted Thomas 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.

Ted Thomas classIf you’d like to learn more about government tax defaulted real estate, which is sold at public auctions for 10, 20, or cents on the dollar or learn the secrets of tax lien certificates which pay guaranteed returns of 16%, 18%, up to 36%, then get started today with the FREE Master Class.

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All reasonable efforts have been made to ensure the accuracy of the information presented in this article.  Laws and regulations may change and you must be knowledgeable in the current laws and regulations at any tax defaulted property auction.  


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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