Updated over 9 years ago on . Most recent reply
New Investor
Hey Ya'll,
New investor here. Saving capital for my first rental. I wanted to ratchet things up a bit and earn some money using tax liens.
I have the benefit of living on the border of NE/IA, hooray two sales!
What are the major things to watch out for?
The way I see it you can go wrong two ways.
1. Acquire a lien on a dud. That could be an undevelopable property/condemned/0 value.
2. Risk too much money on one property. If the lien > 10% property value, stay away.
NE/IA both use the random draw process with no bidding down interest rate. NE is 14% per year, while IA is 24%.
Nebraska needs 3 years of non-payment for foreclosure, IA 2. Worst case scenario, don't get paid for 3 years and have to spend some money to foreclose.
How can I lose?
Matt