Property tax sales
A property tax sale refers to property being sold by a taxing authority or the court to recover delinquent taxes. When property taxes are not paid, title gets transferred to the state. The owner will then have a period of time to redeem the property by paying the overdue taxes, including penalties and costs.However, if the property is not redeemed within a prescribed delay, it gets deeded to the state, after which it becomes available for buying to the public as a property tax sale. Anyone who owns property must pay some sort of real estate tax to the government.These taxes in turn fund numerous services, including hospitals, schools, law enforcement, road construction, parks and playgrounds.
Modus Operandi
If a real estate owner does not pay the required taxes on a property, the county will offer the property up for sale at an auction as a "property tax sale" to help generate the lost tax income. There are two types of tax sales, tax lien sales and tax deed sales.In tax lien sales, the county government sells their right to the tax lien on the real estate property, allowing the buyer to bid on the tax debt for a favorable return on investment. In tax deed sales, the county government sells full ownership and possession rights of the property to the investor. Both result in a flexible and secure investment with minimal market risk.
Where to Look
If an individual is interested in participating in a tax lien or tax deed sale, probably the fastest way to find a sale is to contact the county government's office for specific information and details about potential sales and the properties involved. Once an individual finds out what properties are for sale, one needs not wait for a property's auction to begin the purchasing process. One would be able to use the list of tax sales from the county to find motivated sellers who want to sell their lien or deed before the auction.
Even one can get an old tax sale list and contact the new owners of the lien or deed to see if they are interested in reselling their purchase. As with any real estate investment, proper research of a property involved in a tax lien or tax deed sale beforehand will minimize any risks that may arise. An individual should be sure to view the property and research its value, before opting for the deal.In addition, it is important to research the title for current property, in addition to any tax, judgment and/or mortgage liens, and trust deeds. Moreover, one should know and understand which type of sale an individual is attending, a tax lien or tax deed sale. Each has specific rules and guidelines which must be followed, which can differ from county to county.In addition, not all states allow tax lien and tax deed sales, so it is important to investigate the particular state's tax laws before pursuing a property tax sale.
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