All Forum Posts by: Will Sifert

 That must have changed at some point, it's all premium bidding now. 

Mississippi Tax Lien Auctions are conducted by a "premium bid," meaning the highest bid wins. Bidders are bidding up from the face value amount (taxes, interest, fees, and penalties). Any amounts placed above the face value amount would be considered an "overbid." The purchaser does not earn interest on the "overbid," only on the face value amount. You are encouraged to investigate and research any parcel you are interested in prior to making any bids.

That sounds very suspicious and problematic. I would be making phone calls and digging into that to find out for sure what you have. 

 Let's work this out, I'll post everything I know about each state if you can do the same and maybe other people can fill in the holes. I have been wanting to do this for a while now anyway.

Alabama: Redemption Period 3 Years, about 1/2 of the counties bid down interest, not sure of the process to get a deed. At least 1/2 counties online.

Arizona: Redemption Period 3 Years, Foreclosure process, Bid down interest. At least 1/2 counties online.

Colorado: Redemption Period 3 Years, Deed issued by Treasurer, Prem bidding non refundable. Interest rate 9% a year currently. At least 1/2 counties online.

Iowa: Redemption Period 2 Years, Deed issued by Treasurer, Bid down percentage of ownership. Interest rate 2% a month. Most counties online.

Louisiana: Redemption Period 3 Years, Foreclosure process, Bid down percentage of ownership. 5% initial, 1% month rate. About 1/2 parishes online.

Mississippi: Redemption Period 2 Years, Deed issued by County, Prem bidding non refundable. Interest rate is 1.5% a month. Most if not all counties are online. 

Montana: Redemption Period 3 Years, Deed issued by Treasurer, Random draw bidding. Interest rate is 2% initial 10% year. I believe all are in person.

Wyoming: Redemption Period 4 years, Deed issued by County, Random draw bidding. Interest rate is 3% initial 15% year. All are in person. 

If anyone knows the above information for any of the other  tax lien states please share it here, Thanks. 

 Jerry thanks for the explanation. The new way that AZ handles the tax liens when the subsequent year is not paid is exactly how we do it in Louisiana. If I purchase a tax lien and then don't pay the next tax bill, it will go back to tax sale the next year. When the next tax lien buyer gets it, my 3 year redemption period starts. Essentially I can do nothing for 3 years while I wait to see if the original owner redeems it from me or not. So, 3 years from the date of the tax sale I purchased it, if the original owner did not redeem then their redemption period expired. I could now move forward with my suit to take ownership (which sounds very similar to your judicial foreclosure). But I have to redeem from the tax lien buyer who came after me prior to 3 years from the date that he bought the lien from me, or I lose everything. He could then start the suit to take ownership and would include me and the original owner, to quiet title against us. In that case I would lose the money I spent when I bought my tax lien.

It's a little complicated to follow, a white board would make it easier. Some people use that  as a strategy. If you are trying to acquire property then the more liens you buy the better your odds so some people will spend all of their money on buying liens and not tie any of it up on subsequent year taxes.  If the original owner redeems, fine you get your money back plus interest. If it goes 3 years then you redeem from the tax lien buyer after you to get rid of them and then start the suit against the owner. The only down fall is that you going to have to pay a lot of money in interest.  Since Louisiana has good interest rates, I prefer to pay the subsequent year taxes so I can make really good interest, instead of having to pay a lot of interest to someone else.

The one thing I am seeing about Louisiana that I really like that most other states don't have is firm redemption period. We have 3 years (technically from the date the tax lien is recorded, not the date of the sale. Which can be 2-3+ weeks after the sale.)  But when it hits that 3 year point that's it, the owner can not redeem the property, PERIOD. It sounds like AZ allows them to redeem the property any time, even while you are trying to go through the judicial foreclosure. Here they can't do that. Once their redemption period expires the only thing the owner can do is hire an attorney and sue to try to get the tax sale annulled. This gives the tax lien buyer a lot of leverage. The owner finds out quickly they are going to have to spend 5-10K or more in legal fees trying to fight this. I have settled with people and it has included all my money back plus interest plus a premium. They can either pay me or pay their attorney (and still likely lose the property). Other states, when you apply for a deed after the redemption period the owners can still pop up and redeem. It seems like the purpose of a redemption period in most states is to tell the tax lien buyer when he can start trying to foreclose / apply for a deed. Where as IMO a redemption period should be the time the owner has to redeem the property. When that date expires their ability to redeem should expire with it. 

 About 1/2 of the residential lots I acquire from tax liens I end up selling to a neighbor. Most of the ones I get I have sold between 18-35K.  How much do your attorney's fees roughly cost for a foreclosure? I know it can vary for complicated cases. Here it could cost 3-5K for attorney and court costs. We have a $500 cost to appoint a curator for the owner if he is not found (well if he isn't served). Because of this reason I usually never bid on anything that is worth less than 10K, usually properties that are worth 20K or more. People who bid online from out of state, they have no clue and they bid on all of the cheap properties. Even if they get it, they going to lose money and they bid purposely on the ones that are less likely to redeem.  In other states where the county issues the deed for $300 you can get away with buying tax liens on properties worth only a couple thousand dollars, but not in Louisiana. 

 I second that, we are 100% the same here! 

 I am a tax lien geek, I find this all so fascinating. In Louisiana we have a 3 year redemption period. During the redemption period, the owner goes to the sheriff's office and fills out a redemption form and pays all of the past taxes and interest etc. 3 years and 1 day, if the owner goes to the sheriff's office to redeem they turn them away. At that point the owner only has two options, contact me and we work out a deal or the owner has to get an attorney and sue to annual the tax sale. Once 3 years has passed I can start the process to confirm the tax sale and quiet title at anytime. Our tax liens never expire. But there is really no point to wait long because once it goes three years it's not about making interest any more, your only way to make money is by getting the property.

So in AZ, you have to wait 3 years before you can start the foreclosure process, but until you do the owner can redeem at any time? After 10 years the lien is cancelled and removed, you lose everything you invested (is that correct?) 

Thanks for the info. 

 Jerry, how did they redeem 10 years worth of taxes, I thought Arizona has a 3 year redemption period? 

 So many people ask how to get started and a lot of them seem to gravitate to a class instead of doing research. I guess it's just what a lot of people are conditioned to do (we grow up learning from the classroom)?  However there is sooo much information online, a lot of people either don't realize or don't want to put the time in to find it. Even though in most cases it's not that hard to find.

When I get a little time I am going to put a free page together that answers "how do I get started with tax sales".  So there is one good source to point everyone to vs having to repeat ourselves over and over and over and hopefully prevent people from wasting lots of money on classes that usually won't provide them with much benefit, if any at all. Not to mention some of those classes and mentoring etc. are straight up scams. 

Don't waste your money on these type of "courses" or what ever they call it. It's a sales pitch with all hype and no substance. The majority like this just up sell you for more and you never really end up with anything. You can find more information from sites like this, facebook groups, youtube videos, or just google. They charge you $$$ and you never really learn specific details you need about particular states where you will be investing.  You don't need to spend money to find out what tax liens are and that they can be a good investment. You do have to spend a lot of research, time and experience to learn the specific laws and bidding procedures for the state you want to invest in. These generic national programs will never teach you the details and what you really need to know for your state.