Tax Deeds:
In states that do not utilize tax lien certificates, tax deeds are common. Here, the county forecloses on properties to recover unpaid property taxes and sells these properties at auction, often without mortgages, providing a clear title to the purchaser. Understanding the local regulations is vital, particularly if the state offers redeemable deeds, which allow property owners a specific period to repurchase their property by paying the owed taxes plus a penalty.
Redeemable Deeds:
A redeemable deed auction allows the investor to bid on a property, adding a penalty that the original owner must pay if they wish to reclaim their property. For example, in the State of Georgia, the penalty fee is 20%. If the owner redeems the deed, they must pay not only the original taxes owed but also the auction price plus the accrued interest and the 20% penalty fee. If the owner fails to redeem the property within the redemption period, the investor then owns the property outright. This type of investment can be particularly lucrative but requires understanding of the specific terms and penalties involved.
Exit Strategies:
Upon acquiring a property, investors should have a clear plan on what to do next. Options include:
Buying and wholesaling the property quickly.
Fixing up the property and selling it for a profit (flip).
Renovating and renting out the property for ongoing income.
Offering a lease-to-own arrangement to potential buyers.
Resources:
Summary:
In summary, investing in tax liens, tax deeds and redeemable deeds can be a lucrative venture if done wisely, with a thorough understanding of the legal frameworks and market conditions of the state where the properties are located.
Disclaimer:
Investing in tax liens, tax deeds and redeemable deeds involves inherent risks and complexities. The information provided here is for informational purposes only and should not be considered financial or legal advice.
We strongly recommend seeking professional guidance from:
Tax advisor: They can advise on tax implications of buying tax liens, tax deeds and redeemable deeds.
Real estate attorney: They can navigate the legal processes involved in acquiring and potentially foreclosing on properties.
Title company: They can research and verify the property title and any potential claims.
By consulting these professionals, you can make informed decisions and mitigate risks associated with tax liens, tax deeds and redeemable deeds Investments.
TLTD Investments LLC makes no warranty expressed or implied as to the accuracy of the information represented herein. This website shall be accepted ‘as is’ with all faults. Any person, entity or company that makes use of this site shall hold harmless TLTD Investments LLC, it’s employees and agents from and against any claim, damage, loss, action, cause of action, or liability arising from the use of this website.
