All Forum Posts by: Dennis K.

@Jerry K. - Howdy Jerry, thanks for coming into conversation and I saw your forum & blog posts too.  I hope you're enjoying life in AZ over IL.

1) Value of tax liens on foreign owner over several parcels is less than lawyer would charge for consultation.  I'm raising this question to few counties to get a simple answer which would be I would still have to use Certified Mail without getting it accepted in foreign country or use Fedex with signature confirmation which may or may not be accepted at the foreign owners address.  If I don't get an answer I'll just skip parcels owned by 1 particular foreign owner and get a few parcels in exact same subdivision that are delinquent long enough and owned by USA owners.

2) I meant that in 2018 there was a lien placed on the property at statement of taxes and for 2019 & 2020 it shows taxes unpaid.  So whenever 2018 lien was placed exactly (I don't remember exactly which parcel I was referring to since I've processed hundreds more since) it would be 2021 (+3 years) when it would be eligible for foreclosure.

I guess going back & more things I've learned now my question would've been better phrased - If there is first placed lien which is close or beyond 3 years redemption period would other year of unpaid taxes would have to be turned to liens or could be paid off to satisfy redemption at +3 years.  I've already learned the answer to this. 

I'll take your advice and skip parcels where there is still unpaid taxes for 2019, 2020 in general but I do want to confirm it with you if I'm understanding your logic correctly in this type of scenario
It shows interest for 2014 / 2015 which is as far as history goes.  My understanding that 2016 lien was placed on 2013 taxes and that explains that 2014,2015 have small interest from county but not tax lien interest.  At 2016 /2017 / 2018 liens are created and shows 16% interest from tax lien. With first tax lien placed in 2016 this parcel is eligible for foreclosure. If I foreclosure it I would still be required to pay all unpaid taxes.  Wouldn't it be better to pay them off before they have any interest and / or tax lien interest of 16% added to them.  I understand that in scenarios where property is not eligible for foreclosure I wouldn't want to pay unpaid taxes yet and better to wait for them to convert into lien and time would be beyond 3 years from initial lien.

As you can see from this example I'm hunting down very cheap properties with very cheap yearly taxes and tax liens.  For most these properties are of no value, including original owners and I feel most have abandoned them.  I am also aware that there is no way to get title insurance on it for anyone who would want to get loan to build a home due to the type of the deed that is given on it.  For me its obviously better to try to acquire parcel for under $200 each via tax liens + cost to send few certified letters / post ad in newspaper or purchasing property from the county at $600-750 when retail prices are $1500+ for lots that don't have as good of a view as the ones I've found.  I'm counting on several photographers that I know to flip some of the lots I get with good views from the start as well as recruited few friends who want to start flipping land within their communities.  I'm transparent with everyone that this is not the type of community where most people develop, its more of complete ghost town and explaining to them that whoever they resell it to would not be able to get a loan to build a home.  Knowing this information they're targeting FOMO kind of crowd.  They buy few parcels from me at discount from expected retail price (at one or few different subdivisions / geographical locations) and start bragging to their friends / family that they're following my steps in investing & flipping vacant land. We live in a large city where most people either rent or own apartments.  There are many that never owned piece of land in their life and when they hear about others who are investing into it affordably they get FOMO. About 15+ years ago there was a local marketing campaign to sell land in FL and many people jumped on while some missed out.   One of my friends referenced someone he knew who bought FL land for $5000/ 5 acres and there were some swampy parts.  He paid $500 to have some sand poured over few patches and flipped it for $10,000. My friend wished he would've done the same and now I'm offering hand selected parcels at below retail cost and he wants to jump on the opportunity to resell to others.  For non photography people I've found lots that are closer to center of town in more developed parts of subdivision and do have direct or nearby power.

Overall I'm continuing to analyze more data and finding more opportunities in different counties. I've decided to narrow down my first round only to one county  and just near one town where there are few subdivisions.  I'm getting 11 lots with nice views, direct road access  and will keep 3 best for myself and flip 8 to photographers. I'm getting only one small lot in developed part with direct access to power and for now skipping few others that I've found with power nearby.  This lot will be offered to my non photographer friends to flip. At the same time I've identified several lots that are just as good as one I'm purchasing and in some cases better that are available collectively for under $1000.  All of them have first liens placed starting in 2016, 2017 and would be ripe for foreclosure. One under $200 tax lien on nice double lot with lien beginning in 2016 belongs to a trust and I will avoid purchasing the lien and instead wait for county to foreclose it and offer it via back tax lot purchase.  My average cost per acre is $436 on purchases where I see retail prices start at $1500 for just any lot in same subdivision which is far away from the views and may or may not have road access.  Easily accessible lots with similar views slightly further away from my lots are offered at $2500+  There is a lot of room for me to make 3-5X return on small handful of lots I'm getting in round 1.  I'll post an update on my journey as it develops.

@Ned Carey You said that one lien purchase you made out OK and had leverage over the owner and said that in another lien purchase you later found out that owners had easement.  So in my asking I was referring to the second lien experience you described as your second story.  Thanks for answering it.

I'm exposing myself to much smaller liens. HOA liens that I've mentioned are less than 1/10th of your lien amount.

Hypothetically speaking if developer wouldn't pay your lien and if you would foreclose they would still be allowed to use easement but not have the right to use other parts of the parcel, if there are any.  Since you are the new owner of the land you can hypothetically put up a large sign advertising some service / product for which you would receive some money.  Owners can still drive through your land but they will start asking developer what is going on and he would have to explain that at first he didn't pay taxes on it and secondly he refused to pay your tax lien and ended up losing the property in foreclosure.  At that point you would have a lot more leverage....

@Ned Carey thanks for sharing Jerry's link, I did run into his posts and read some of them.

As I've mentioned this is mostly from my analysis abandoned vacant lots.  Each one is under $5000, even with electricity near and I'm primarily plan to sell it for cash offer without any financing.  If someone really wants I can always owner finance and earn some interest on top.  Nobody that is purchasing from me has any interest to develop this land into something else.  Originally I thought of buying few lots from one investor and create small photography community with shared resources (solar / septic / well / etc) but research showed that getting these utilities is very expensive with well costing upto $50k alone because of the depth it needs to reach to find water.  We wanted to buy few cheap Chinese modular homes that 4 can fit into one shipping container and use them ourselves as well as rent them out.  Getting these modular homes / shipping / assembly is fairly reasonable but utilities were out of hand.  One person has an RV so its easier for him to use empty land while others are OK with just camping.

I am aware that lawyers fees will have to be repaid if owner redeems but I expect most of these to be people that walked away.  Lets say they originally paid $500 for each lot many years ago and now have $700 in liens.  There is not much reason for them to try to get it back since with taxes they already paid their total investment per lot can be $1300+ and similar lots within same subdivision retail for $1500-$2000.  For me $700 investment that can turn into almost 2.5x would be worth it but for them it would not be.

For 1 & 2 I'm trying to get answers from the county and will ask other counties as well.  With Certified Mail there is really just 2 outcomes that can exist that would lead to next step.  One of them being that I would still have to use Certified Mail and get proof of me sending it in USA while foreign country would not be able to provide proof of delivery or I would have to use another service (Fedex) which could provide it.  In my cases I expect that it would lead to foreclosure due to owner not being contactable and would proceed with next required step is to post notice in local newspaper.

Mojave County has a detailed list of steps one need to do to foreclose on tax liens - https://www.mohavecourts.com/c...

3) Thanks for your input on junk, you're right that it can be cleared but electricity would be harder to get.  I might put this one for round 2 after I acquire some land in the area and visit it personally.  I've planned to go there this month but decided it against it.  The cost of travel would allow me to buy 2 more parcels and I'll go there next year when weather is better and when everything is already transferred to my name (some counties told me it can take few months).  I might ask photographer friend who might be in Southwest area to do photography / videography for me.  I've done that with my Miami condo where I couldn't get out there in time on my own and asked my local friend to help it.

4) Thanks for sharing your stories.  I am curious what was the eventual outcome of the second one.  Lien amount is not that much and worth a gamble if it turns out like your first story.

I've read the SF story when it originally happened and its sad that the sale was overturned.

I would start with checking if you're allowed to use Airbnb where you want to have a vacation home. I own properties in Miami-Dade and they have various rules & regulations that dont allow short term rentals. Most recently entire city of Sunny Isles Beach put their own restrictions not allowing short term rentals due to COVID. You have to worry with state / county / city / HOA regulations. With condos there are very few buildings that are reasonable (ie. not $5M beachfront building on Collins Avenue) that allow short term rentals and some private home HOA put restrictions as well. My parents are retired there and across from canal of their condo there is an old crappy private house that seems to be on AirBNB since my mom constantly sees new people occupying it and owner gone. This is all within gated community and this house neighbors better houses & 12 townhouses which might be sharing one HOA. I mention this because my parents know some owners of the townhouses, including one right next to AirnBNB rental and a lot are complaining about constant flow of strangers. Their HOA can change their rules and not allow short term rentals and follow what many others already done. They care about quality of life of the owners that are primary residents and don't want area to turn into hotel.

You should consider all current and future regulations that you might have to face with short term rentals.  If you rent it out once a year to snowbird for 6 months and use it yourself during 6 other months its doable but I feel you would want to enjoy the property yourself when its cold.

PS. My parents originally looked at Sarasota area when their friend gave them keys to her condo.  They ended up settling in Miami Dade county instead because there is just more things to do.  In Miami there close to everything versus in Sarasota things were further apart.  They said that in some areas where they looked it would be 10+ mins to get to supermarket versus where they are its a 2 min drive or 10 min walk of few blocks.

If you live in it as primary residence for 2 years you can then rent it out for 3 years and sell it without having to pay taxes on upto $250,000 in profit.  I would extend your residence by 1 year to utilize this loophole.  I've done it with my first condo and ended up selling it with a tenant.

@Canesha Edwards

I agree with you and follow same strategy which in my case is vacant land.  I find area that has mostly vacant land that people bought many years ago and never developed.  The area has nice views and I've found it via websites that sell vacant land.  From finding lots that others sell I investigate other lots nearby and jot down owner information if its of interest to me.  In my case I feel that a lot of people abandoned this land with many having unpaid taxes, trusts left behind, etc.  For some of these lots I plan on sending owners a letter asking if they're interested in selling at below market rate.  I'm basically looking for good deals and typing out 1 letter sent to 50 addresses is not time consuming or expensive.  Even if its 1 response out of 50 I can make more than enough.

There are deals everywhere and for everyone if you look hard. Buying properties is a lot harder than buying vacant land.

Howdy everyone,

I'm new to the forum and just beginning my journey into buying delinquent back tax parcels as well as some tax liens in several counties in Arizona.  I've done a lot of research here and in other places trying to answer questions that I've had.  Some I was able to answer and some I still can't get a definitive answer and I've asked one of the AZ counties treasurers office.

My initial strategy is fairly simple.  I'm getting ~20 lots in one area where subdivision has a lot of vacant land.  My guess is that many years ago there was heavy marketing in promoting this area and many people jumped on it thinking that they will become millionaires.  Most of the lots in this subdivision are still undeveloped and there is more development closer to town and further you go away its almost ghost land. I've located several parcels away from town but with direct dirt road access that have nice views and no neighbors at all.  I've also found few closer to center of town with 2-3 being near power (hard to identify with Google Earth) and there are other developments nearby and another 2 on the other side of town - one with electricity right at the lot level on the road (but it seems that lot has a lot of junk on the property from previous owner) and another lot on the same road has power 2 lots away and the lot is clear.  I have lots of photographer friends that expressed interest in purchasing remote lots with good views from me to use for camping / RV / etc and location has proximity to other areas of interest for photographers.  In other county I'm finding tax liens which are cheaper to acquire and I believe most of them will end up in foreclosure. As stated before I believe many of those parcels are abandoned investments that people made in the past and stopped paying taxes.  I'm seeing plenty of parcels that belong to owners that have 3+ tax liens on them which would instantly qualify them for foreclosure process.  I know how the process works but there are few nuances that I had analyzing all possible scenarios and was wondering if someone had similar experiences and answer some of my questions:

1) Foreign owner address & Certified Mail letter of intent to foreclose - since there is no way to send Certified Mail to another country I wanted to know if another trackable / signature required service can be used in lieu of it (Fedex) and while still sending Certified Mail to county.  I'm fairly certain this owner would not be reachable and next step of action would be to post notice in local newspaper.

2) I see some liens with one 2018 tax lien listed but the owner hasn't paid 2019 / 2020 taxes but there are no liens created for 2019 / 2020.  If I buy 2018 tax lien and pay 2019 / 2020 taxes would that cover requirement of 3 years since first lien was created (whenever the actual date is in the near future)

3) I'm trying to avoid picking up unnecessary parcels during my first round.  One lot has direct access to power but seems to have junk of the property.  I know that lot with utilities are worth more and I'm curious what people's opinion would be if power outweighs having junk of the property left by previous owner.  So far I'm thinking of avoiding it.

4) I found an interesting sub division where it appears developer built a bunch of single / multi-family vacation homes.  I found a lien on what appears to be common areas of part of this subdivision.  It would be driveway that leads into small part of the sub division as well as parking in front of large / small vacation homes.  It would be totally awesome if I can somehow luck out and foreclose on them but chances of that are slim.  What I found strange doing my research is that the owner address for larger homes appears to be the developer of this community and lists private home.  I found several individually owned cabins in the area that are delinquent and they belong to a trusts which are registered to the same private home of the developer.  I find it very strange that someone would purchase vacation home, put it into a trust and for some reason continue to use developer's home address to receive official notices.  It also weird that if developer was / is acting in some sort of managing agent role that he would not paying taxes on parcels that belong to development company as well as parcels of vacation homes that were sold to others.  Delinquent taxes on individual vacation homes are for several thousand dollars and in my estimate are 4+ years behind. From research I found out that foreclosure process on trusts is different and I will be avoiding dealing with them early on into this journey.

I would love to get feedback / comments on the nuances of scenarios that I've described.  Few of the people that I have to initially flip it too are not RE investors but they suffer from FOMO (fear of missing out).  One friend told me yesterday that friend of his bought land in FL (10+ years ago) when it was heavily marketed in my area for $1k / acre.  It was a bit of swamp land and he put some sand in few areas and flipped it for $2k / acre.  Now my friend wants to do the same and buy from me and find someone to flip within his own community of friends and family.  There are many people that never owned land and purchasing it will be reason to brag about it to others.  I'm fairly certain I can flip most of the parcels within my community without even advertising online.  Whatever remains I can easily list on free / paid websites where land is sold as well as create my own website with lots of good photos / videos / maps / etc.  All profit I will reinvest into buying more parcels to flip as well as some tax liens for good return with a chance of foreclosure.