My friend buys tax liens here in AL. From what he as told me it is similar in other areas. He gets 12% annual interest on the unpaid debt. After 'x' number of years he can sue for quite title. Quite title is a long possess also that involves taking out newspaper ads. The process takes years to get ownership of a home. Also, while you are waiting on ownership, the building can be degrading.
He said he buys tax liens on homes that are mostly to be sold by the owner. When the sale closes, His tax lien + interest is paid off.
As for Washington state, They are more socially responsible than Alabama. My guess is they afford the owners more rights there. An easy way to get info is to go to your local tax sale/auction.
(dyslexia, not educated in AL though :)
@Maria Luna, yes I have bought property at tax sales in Washington state. WA is a tax deed state, which means you get the property (and not a lien) when you win at auction. You need cash and its either due right then (literally you walk up and pay and everyone else waits to see if you have funds) or wire within 5 days.
My experience so far is that you can get discounted properties, but there are no "easy deals". If something is worth money, chances are a few people are there to buy it. For instance Thurston county just did their auction earlier this year and a house in downtown Lacey went for around 140%? Assessed Value, 50% ARV. It was gutted by fire, holes in the roof, covered in junk, condemned, etc. But if you are creative, lucky, or both its a great way to get property.
Also most of the state is slowly switching to online auctions. ************** is what all of the counties are using.
Hah my bad - I won't post the website name but its on the Thurston County Treasurers webpage. The Lacey demolition house went for 65k.
I've been down to the auction in Tacoma a few times. It's pretty chaotic for the novice, but everyone is super friendly and happy to help new players learn the ropes.
With the market being the way it is, there are usually a handful of reps from the various hard money lenders standing there with a big folder of checks ready to buy almost anything in sight. The margins are stripped off a lot of those deals since the local flippers are often very willing to pay a premium just to get a deal locked down, so keep that in mind.
I have been doing some research into this. I know this is an old thread, but I am curious how the "pros" come up with their max bids? Do they base it off the assessed value of the property? Since you're not able to inspect the property or do feasibility studies, etc. Any insights would be extremely appreciated.
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