If I wanted to buy a tax deed property, could I get hard or private money for that?
The way the county does it is I have to pay 10% cash up front, then I have 3 days to pay the rest of the money.
1. Is 3 days enough time to get a hard money or private money loan?
2. What’s the best place to find a lender for this type of purchase?
3. If the lender spotted me 50k, and I did all the rehab work, does a 50% profit split seem reasonable?
Ask your hard money lenders. I personally think this will be tough unless you have a track record. I think it will be tough for them to spot you the money up front. I think it would be tough for most to do their due diligence in 3 days.
I think with something like this you need to raise money from people you know and know you. You use some of your own money, you borrow from friends and family. You do one. Then you do another. Then you do 3. Then you do 3 per auction. Then you go to hard money lenders and show your success.
You may have to reduce peoples risk as well. Maybe you buy in their name, not your name.
Let us know what works for you.
You also need to check in your area if there is redemption or challenge periods. How long do you have to hold the property before you start renovations or sales. In my area redemption period can be 2 years....so we really don't want to start reno or sale in most cases until that time is up.
Questions For You:
1) Which county and state are you looking to buy a tax deed property in?
2) Has the county performed due diligence and issued title insurance on the tax deed they are selling you so that you can assure your lender you are buying a clear title for the money they loaned you?
3) In the county you are working, are you certain you have the right to enter and renovate the property immediately after purchase of the tax deed?
4) What are you going to do if the tax deed property you wanted is bought by someone else at auction?
5) Have you visited and confirmed that no one is living in the tax deed property you want to buy at auction?
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