Back Tax Foreclosure Homes Can Be Your Ticket to Some Nice Profits
If you're looking to invest in property, back taxes foreclosure homes are among the best investments you can make.
Aside from being available for a song, they are often also free and clear - that is, they almost never have a mortgage or other big liens that might complicate their resale.
The key is knowing how and when to get them - without getting them at tax sale.
If you haven't attended a tax sale, here's why it's a bad idea to buy at tax sale.
The biggest reason is the competition.
Too many other bidders means that properties will end up selling for close to retail value.
Almost as big a reason is that you can't inspect the back taxes foreclosure homes you bid on at auction first.
That means that if you do end up winning your auction, you may very easily end up with a property worth much less than you thought it was.
It's better to avoid the tax sale by buying these properties directly from the tax delinquent owners themselves.
But don't approach them before the tax sale, like most investors do.
Wait until after the tax sale, during the redemption period after tax sale (usually 1 year).
Since their property has already been sold at tax sale, these owners are highly motivated to sell their deeds to you so they can at least get something before the property is permanently lost.
You'll find you're able to make all kinds of deals with these owners.
Don't want to own the property? You'll be able to make deals to buy deeds for as little as $1, and then flip it to an investor for tens of thousands more, after which you split the proceeds with the owner, having never had to put your own money into it.
If you're not interested in owning property, you may want to consider getting into the tax sale overage collection business.
When more is bid at auction than is owed in taxes on a property, the difference is usually due back to the owner.
For a variety of reasons, these owners almost never know about this and move on without collecting the money.
This is one of the best-kept secrets in real estate: since these funds aren't subject to state laws governing finder's fees, you can locate owners and assist in recovering their funds for a 30-50% finder's fee.
Since if you don't alert them, the money will be lost at some point a few years down the line permanently to the government agency holding it, this is a very valuable and necessary service.
Doesn't hurt that it has an easy six-figure a year income potential as well.
Aside from being available for a song, they are often also free and clear - that is, they almost never have a mortgage or other big liens that might complicate their resale.
The key is knowing how and when to get them - without getting them at tax sale.
If you haven't attended a tax sale, here's why it's a bad idea to buy at tax sale.
The biggest reason is the competition.
Too many other bidders means that properties will end up selling for close to retail value.
Almost as big a reason is that you can't inspect the back taxes foreclosure homes you bid on at auction first.
That means that if you do end up winning your auction, you may very easily end up with a property worth much less than you thought it was.
It's better to avoid the tax sale by buying these properties directly from the tax delinquent owners themselves.
But don't approach them before the tax sale, like most investors do.
Wait until after the tax sale, during the redemption period after tax sale (usually 1 year).
Since their property has already been sold at tax sale, these owners are highly motivated to sell their deeds to you so they can at least get something before the property is permanently lost.
You'll find you're able to make all kinds of deals with these owners.
Don't want to own the property? You'll be able to make deals to buy deeds for as little as $1, and then flip it to an investor for tens of thousands more, after which you split the proceeds with the owner, having never had to put your own money into it.
If you're not interested in owning property, you may want to consider getting into the tax sale overage collection business.
When more is bid at auction than is owed in taxes on a property, the difference is usually due back to the owner.
For a variety of reasons, these owners almost never know about this and move on without collecting the money.
This is one of the best-kept secrets in real estate: since these funds aren't subject to state laws governing finder's fees, you can locate owners and assist in recovering their funds for a 30-50% finder's fee.
Since if you don't alert them, the money will be lost at some point a few years down the line permanently to the government agency holding it, this is a very valuable and necessary service.
Doesn't hurt that it has an easy six-figure a year income potential as well.