What is Tax Lien Certificates?

Question

What is it anyway? I heard you could make $ out of it.

Answer 1

Tax liens are basically liens on a property because the owner is delinquent in paying it. If he pays it back, he has to pay interest. Now the cool thing about it is, investors come in and take those liens from the county and wait for the interest to come in. There are ways to invest in tax liens online and in your local jurisdiction. You should check out www.investingwithoutlosing.com or you can buy books that can guide you. I have left a suggestion below.

Answer 2

Tax liens are not government guaranteed.

Property taxes are owned by the owner of a property. In some states the tax authority that is collecting taxes has the option to sell off the debt they are owed when someone fails to pay. They would do this so that they can pull in the cash they need to pay for the public services.

The tax lien is secured by the property. The government entity will handle the collection if the party that owes the tax pays up. If they fail to pay then the owner of the tax lien certificate needs to take action to seize the property. It could work out that the property is not worth the value of the lien. Note that there can be cases where the property owner knows this and has wisely chosen not to pay the taxed.

Do your own research. Assume nothing. Tax lien certificates come with zero government guarantee. Know what the property is that secures the lien. Make sure there are no reasons that the property is worthless (toxic waste, flood problem, lack of access to the land). Some folks make a great return and some of the time you can foreclosure and get a property for a bargain. Some of the time the lien is on swamp land or other land that really is not worth the amount owed so you will never get paid. You will own land that no one wants or you just walk away from the investment.

Answer 3

There is a government-guaranteed investment that can provide high returns. It's just that most people don't know anything about it. It's called tax lien investing. This secret is referred to as the millionaire maker, and even now very few people know or capitalize on their existence. It's called a Tax Lien Certificate. In hundreds of counties throughout the United States, local governments have millions of dollars in outstanding and overdue property taxes. Local governments use property tax to fund the daily services of police, fire department, welfare, and teachers. The lien is secured by the real estate property it is attached to. To put it to you in plain terms, you will be paying someone else's property tax. Statistics show that 97% of tax lien certificates pay off within two years. The property owner pays his taxes at huge interest rate, and that interest plus the money you invested all goes to you. The longer the owner leaves his taxes unpaid, the larger your pay off becomes. If the owner does not pay his taxes then the property becomes yours free and clear. You now have the options of selling, renting or living in the property. It is truly a win - win situation.