April first has come and gone. I have nine 2016 certificates that are now redeemable. I am investing for the interest only. Should I wait for the next investor to complete a tax deed application? Wait for the owners to redeem? Fill out the tax deed applications myself? Or something else?
All of the properties do have some value. Some are mobile homes. Some are vacant lots. Though I do have enough cash to do so, I am out of state and not looking forward to paying the roll up and trying to sell the properties.
I love reading these forums. This is my first investment in real estate and I would be happy to let you know what happens.
Rental Property Investor · Bradenton, FL · Member since 2018 · 73 posts · 61 votes
7y
@Don Ferman you can now apply for a Tax Deed which will trigger a tax deed sale. The government will sell the property at public auction to the highest bidder. The starting bid is setup at whatever the value of the property taxes due plus interest accrued. You would have to bid on the auction in order to buy the property.
You can get more detail info on the County Tax Collector’s site for the county where the property is located.
Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
7y
Well first, tax certificates are not really a “real estate” investment....
One indicator on if another tax certificate holder may send to tax deed auction (redeeming yours) would be to see how many Certificates were issued Before yours in 2016. Also, that should be considered by you in deciding to apply for tax deed......unlikely the lot will sell at auction to make you whole if you had to pony 5-7 years of taxes plus interest.
Many of theses never get redeemed, or the certificate holder ends up with them at auction because no one wants to pay what the applicant has put out in paying off all the other cert.s.
Wholesaler · Lehi, UT · Member since 2015 · 333 posts · 144 votes
7y
@Don Ferman Although it seems as though a "tax lien certificate" does not constitute real estate, tax liens are a niche of real estate. The tax liens you invest in may well become property acquisition turning your investments into real estate. If you select your tax liens with the foreclosure process in mind and you invest in enough of them, you will acquire properties. Keep in mind that every state may have a different approach to the foreclosure process. Once you have the process down it will make more sense as to how you want to structure your investing be it tax liens, tax deeds, real estate purchasing, notes, short sales, and all types of investment strategies applying to properties.
Some of the situations that cause property owners not to pay their taxes are death, unemployment, divorce, incarceration, etc., etc. If the property owner does not redeem their certificates and you have filed for a tax deed application you may end up with the property providing it does not sell at the tax deed auction. Tax deed auctions are happening more than twice a month in some counties. This means there might be a good chance of no one buying the deed on the property you have applied for a tax deed on. If this happens you will acquire the property.
One thing to keep in mind is population growth in the area of your investment. If the area is up and coming it is very likely you will make more than your original investment which includes all payments of taxes involved with the tax deed application to property acquisition.
Rental Property Investor · Bradenton, FL · Member since 2018 · 73 posts · 61 votes
7y
@Don Ferman you can now apply for a Tax Deed which will trigger a tax deed sale. The government will sell the property at public auction to the highest bidder. The starting bid is setup at whatever the value of the property taxes due plus interest accrued. You would have to bid on the auction in order to buy the property.
You can get more detail info on the County Tax Collector’s site for the county where the property is located.
I just got a check in the mail from Coconino County, Arizona. Even though I earned interest on the certificate, I actually lost money. The purchase price was more than the face value. What is TPIF and is it a fixed amount that you pay on every certificate or is it a percentage?