All Forum Posts by: Adam S.

@Adam K.undefined

This post is a few month old, but thought I'd chime in anyway. 

I successfully completed one nola tax sale, and I have to say it was a learning experience as well. Furthermore, if I knew then what I know now, I would NOT do one again.

I am from NO, and know the city well enough. Candace is correct in that there are areas where I would NEVER consider purchasing the tax sale deed, and not only due to the fact that the law on actually taking ownership on these properties is far from clear.

In response to your original post, I would HIGHLY recommend sending a very clear letter to the owners explaining that you have bought the tax deed and what they owe you. (I would be happy to share my template, just PM me.) I say this because, you do NOT want this to go to court. The law is untested and (in my unprofessional opinion) there is not a clear, constitutionally legal (louisiana constitution) mechanism by which you can take ownership of the property. Thus (IMO) your only recourse (or at least, your arguably best recourse) is to attempt to get the property owner to redeem (and pay you back plus interest). I think that sending polite, but firm letters stating the legal facts are the best way to do this.

I do not know the exact location of your tax sale properties, but "hollygrove" is definitly a red flag, and in neighborhoods like that, there is, sadly, a reasonable chance that the property will not be redeemed. True, the property owner legally owes you the taxes and penalty that you paid, but if they have no assets, and the property is worthless, then there is nothing to pay you with. Furthermore, knowing new orleans, there is a good chance the property has never gone through probate, and the legal owner is not clear or defined.

I dont mean to scare you, but that is how I understand the current tax sale situation in new orleans (note that this does not address the new adjucation sale process, which is a totally different animal, and as I understand it was designed to address some of these issues I am discussing).

Like I said, I am no expert on these tax sales, but I did do one successfully, and I am not very interested in doing another any time soon, until the law is clarified and tested.

I would strongly suggest that you send those letters, consult a local real estate attorney (I can suggest a couple), and look into your properties a bit more.

One additional thought: It is an option to not pay any additional taxes on the properties you bought the tax deeds on. If you dont pay taxes, the properties will go back to tax sale, and a 2nd investor can come forth and buy the tax deed. You will still be in line to recieve the penalty and interest you are owed, but it reduces your subsequent investment risk. I have listened to much more savy investors than myself explain this strategy in detail. It may be a strategy you wish to explore if you later decide you dont want to invest any more into these properties. 

@Paul Haviland

 Welcome! I have just decided to be a bit more active on BP as well.

Do you have an geographical area of focus in Madison?

I am! I have one duplex on the east side so far, and hope to buy another one in the next year. I'm always looking for people to network and chat with about real estate.

I use Scott Petersburg in Madison. (608) 824-1122 He is an independent agent so can do some shopping around for you. I have found him knowledgable and responsive. I was Aldo very pleased with the prices he got me ( through Erie Insurance).

I need some advice on what to do with my rental property. This was my first property, and although I have bought a couple others since, I still have never sold a property. I'd like some thoughts on if I should sell or do a cash out refi, and what are the pluses and minuses of each.

Here are the details on the property:

Duplex in New Orleans, Louisiana. Purchased in 2008 for $325k. Refinanced in 2009 at 5% 30yr mortgage. I currently owe $260k on the mortgage. Over the years I have put in approximately $40k in repairs and upgrages.

I dont know the exact current value, but given its location, the zillow estimate and a realtor friend's estimate from a year ago, it would sell for anywhere from  $415k to $450k (maybe more).

The property is cash flow positive, but not but alot.... My net for the year is just around $2,000, (though the rent is also paying the mortgage and building equity). I live out of state now, and have a property manager, who I trust (he literally lives next door) and does a good job. My parents and sister also lives nearby and check up on the house occasionally. It has never been vacant, and rents very easily, as it is an attractive house in a very desirable area (uptown new orleans by the wholefoods) where rents and property values continue to go up.

Any thoughts on what I should do with this property? I would like to take the equity from and invest in some better cash flowing properties, now that I know (a little bit) more about what I'm doing.

Thanks in advance for you input!

Hi Will,

I did one successful tax sale in Orleans parish. I really enjoyed it, and would like to do more, but I understand that the law is being duked out in the courts, and currently do not favor the investors.

Do you know more about that?

Also, here is another site/blog that I like about Louisiana tax sales.

http://parishtaxsales.com/

Best,

Adam