How to bid on tax liens

2 Replies

Do you bid an amount higher than the amount of taxes and fees owed?


Do you pay the amount of taxes and fees owed and bid on the amount of interest you are willing to recieve?

Wow! I haven't been around in a long time, but it seems like my question has remained unanswered. Can anyone help out now?


Darryl K,

Your question requires a more detailed answer because the rules (statutes or laws) vary from state-to-state.

Let me start with the first part of your question: Let's Say you have $100K (Available Cash/Line of Credit)- which can be used to buy properties. First, your minimum-bid is determined by the Amount of Taxes, Fees, etc. owed on the property: You could actually acquire some deals at the minimum bid price; however, in many cases bidding could increase because other Investors may also have an interest in the same property. This usually makes the bidding more competitive so the bid could exceed the minimum bid. On the other hand, if you are buying properties OTC-Over the Counter, than your bid could be only for the AMOUNT DUE IN BACK-TAXES (all other rules apply, eg., redemption periods, if any, etc.).

Next, there are some states, like Florida for example, that are considered Bid-Down states. Here, you can bid-down "on the Interest Rate" and the Investor(s) who are willing to accept that interest-rate is the winning-bidder. FYI: Florida also conducts Tax Deed Sales and OTC Sales.

Finally, with all due respect, it would be helpful if you could determine if you want to focus on a specific state/strategy.
For example, determine if you want to buy: 1) Tax Deeds with or w/o redemption periods, 2) Tax Liens/Certificates, or 3) Properties with No-Redemption Periods, or
4) just focus on a particular state/city/jurisdiction and know the rules for the type of Tax-Sales conducted there.

Your question is specific to certain states only---it is not applicable to all Tax Sales. Be Sure to Know the Rules for Each State/Sale you plan to attend. I hope this helps, but if you require more details or information, do not hesitate to follow-up.

Be Persistant.

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