Fla county held cert. questions

6 Replies

I have been looking at a list of county held certificates and noticed that several properties had multiple certs  held by the county. I am curious as to whether there is any advantage to owning multiple years when applying for the deed. Some of the properties are of interest to me even after satisfying the other owner's certs if I buy the county ones (some even though homesteaded). Another question I have is whether I would earn the 18%/yr interest on say a 2015 cert if the deed sells to someone else?

Can someone please outline the risks in buying county held certs (especially multiples)?

Do life estates complicate the purchase/deed process?

Any help would be GREATLY appreciated!

If the property is homestead, by statutes  only liens over $250 can be sold, liens under $250 will automatically be held by the county.

Most of the liens held by the county that are not homestead are useless piece of land.

If you don't believe that the liens will be redeemed, you will have to request a tax deed sale before the 7 years deadline. For that you will need to buy all outstanding certificates. If that is your goal, then why not buying them now and get the interest on them already.

The biggest problem with county owned certificates is that of all the 1,000’s Of liens sold, No One wanted those, which is why the county ended up with them.....there is usually a reason. Yeah, a life estate is one example....no use or occupancy of the property until the grantee dies, and as is obvious, they don’t have to pay the taxes.

Originally posted by @Wayne Brooks :

The biggest problem with county owned certificates is that of all the 1,000’s Of liens sold, No One wanted those, which is why the county ended up with them.....there is usually a reason. Yeah, a life estate is one example....no use or occupancy of the property until the grantee dies, and as is obvious, they don’t have to pay the taxes.

How does a life estate would trump a tax deed? Can't you still start a tax deed sale? The winner of the auction should get ownership and occupancy of the property?

When you buy a certificate ... YOU ARE NOT BUYING THR RIGHTS TO A DEED FOR THE HOUSE. 

Many people get confused. Certificates only allow you to force the house to an auction to redeem the amount on the certificate plus interest . 

I would advise you do more research into tax deed auctions if you want properties . NOT TAX LIEN CERTIFICATES . 

To answer you better ..

1. ) "I am curious as to whether there is any advantage to owning multiple years when applying for the deed."

depends what you end goal is. there is no advantage if your goal is to own the property after the sale. You would need to pray no one bids. Then you would want to make sure you own the oldest certificate so that you have priority and can pay off the newer ones. 

2.) "Some of the properties are of interest to me even after satisfying the other owner's certs if I buy the county ones (some even though homesteaded)."

Understood, but what is your end goal. If it is to own a property, then you probably shoot yourself in the foot by buying attractive property certificates, as they will get bid on. You should be looking at these from a yield on interest perspective. 

3. "Another question I have is whether I would earn the 18%/yr interest on say a 2015 cert if the deed sells to someone else?" 

If the owner of the property pays off the cert stopping the sale, you will get the interest you bid on the cert for. 

if the property goes to sale, and gets purchased, you will get your 18 interest. 

4.)"Can someone please outline the risks in buying county held certs (especially multiples)?" 

Risks :

 1.) 

Hypothetical: No one bids on the certs you buy, you lose your investment, but get a deed to own some land, or some really beat up houses or condos in the jungle/hood. 

- lets say you buy certs to really bad vacant pieces of land/houses in the middle of nowhere, which happen to be underwater with a cliff on it. 

You ask.) What is the problem with these parcels, cant I just list them or attempt to sell them ? 

A.) In most cases the reason they were not bid on, is they are undesirable and unsalable. You really are buying from the bottom of the bottom of the barrel. Think about this. In today's booming economy with wages and jobs at an all time high, with houses not even staying on the market for 4 days, someone has to be in a seriously messed up financial situation to not come up with the money to pay their taxes on their houses especially in florida where most of the taxes are relatively cheap compared to the rest of the USA. Now the few that squeak along that are seemingly good deals, get snagged up by investors or people with more money than sense.  So what does that leave ? The bottom of the entire market. the most undesirable of undesirables. Do not fall into a fallacy that you will be able to sell these for profits.  Considering you go to this point your initial investment of the certificate has grown. when you apply for a deed you have to pay all the other certificates newer than yours and this years taxes, fees, etc. this can be 5-9x what you paid for the certificate. all of that will become a loss. 

     So you need to research your purchasing of the certificates and make sure you are buying primo properties. The risk is that you could get stuck with the aforementioned properties and lose out on your investment plus more costs trying to recoup during a tax deed application. 

5.) "Do life estates complicate the purchase/deed process?"

no. ownership vesting does not because you are only there to collect the tax and interest. not the property. 

feel free to pm with more q's.

@Mike S. Yes, I looked into it once ona Dax deed property with a life estate.  The Ownership of the property is transferred ina tax deed sale.  The Life Estate though is a legally “given away” Use of the property, no longer tied to the Ownership of the property....different to there being a lease.

@BJ G.  mike S was asking about a tax deed sale, unlike the OP who was a bit confused on what rights a certificate gives you.  I agree with your assessment of tax liens in Fl, they’ve never made much sense to me as an investor.  To gain ownership you to have to pay off all the other certificates, along with 18% interest, have it go tax deed auction, and have no one else willing to bid what you have already spent on the property....not a good strategy to me.

One clarification though, you mentioned wanting to buy older certificates so as to have “priority” over the newer certiifactes.  There is no such need, Any certificate holder, after 2 years, can send the property to a tax deed auction by paying off all the other certificates and app fees.....there is no priority with the certificates.