Tax Liens in Memphis, TN or surrounding areas

9 Replies

I am very new to REI. I have heard of tax lien investing and have done some reading on it. Does anyone have any experience in this area or advice that they are willing to share? I am planning to attend an auction the next time it comes around, not to bid, but to simply see how it works. Any advice would be great!

Thank You

@Cary Crain I'm a tax lien and tax deed investor. Glad to see you've started doing research already. The great state of Tennessee holds Tax Deed sales as opposed to Tax Liens.

That means you get title to the property once you buy the deed. However, there is a one (1) year redemption period in TN. The original owner has 1 year to pay the back taxes, fees and 10% and get the property back. So if there is a house/building on the parcel, you don't want to do any rehab until after that first year.

Also, TN has many court cases regarding the notice given the original owners prior to the tax deed sale. And even though it goes against state statutes, some TN courts actually give prior owners 3 years to file suit to redeem the property.

Your best bet is to get familiar with the TN state laws on tax deed sales, redemption and getting clear title.

Here's a start: Scroll down to "Tax Sale Information" section http://www.tennesseetrustee.com/node/142

A lawyer's interpretation of the tax deed procedures in TN: http://www.notestinelaw.com/pdf/property_sales_tax.pdf

These ought to get you started. 10% is a decent rate for a year and the prospect of getting title to the property after a year (even with the possible 3 year redemption) is pretty good too.

I have not invested in TN as of yet. but I'm looking at a few areas near the larger cities like Nashville, Knoxville, etc.

@Cary Crain Check out @Jerry K. 's blogs here he writes some interesting stuff about tax sale. I also write about tax sales on my site in my signature but I deal with liens not deeds.

It can be very lucrative but it is not as easy as the Gurus promoting courses about it imply. It is key to know the rules and they vary quite a bit from state to state. Good luck - Ned

@Jerry K. Thank you for the information! I actually looked up some more information on TN and found out that they do hold tax deed sales. Should have looked that up before I asked. One thing I came upon is that it said tax deed (hybrid). What exactly does this mean?

@Ned Carey Thank you for the resources! Also, I'm not looking for something easy. I am definitely going to do my due diligence, but not gather so much information to where I develop analysis paralysis.

Thank you both very much!

@Cary Crain I was not familiar with the term, "Tax Deed (Hybrid)". A little research seems to indicate that it is in fact a deed but with the redemption period being 1 year, it acts a a lien for that first year. Thus, "hybrid".

I could be wrong, but that is my take on the term. The statues for TN don't use that term, so it I can't find a legal definition.

@Michael Clark jr ..... I'm afraid that question is beyond my pay grade.  You may have already seen this, but if not, it's a helpful resource:  https://www.civicsource.com/content/tntaxsaleguide    An FAQ regarding Shelby County TN Tax Auctions.  CivicSource is the online auctioneer that serves Shelby County TN.