Just imagine how with a few hundred bucks from your pocket, and just after a year or so, your money had doubled or grew much more than you would have expected. Of course, you cannot call that luck as you made it happened. It is called good investment, as you sent a few hundred bucks from your pocket to where it should go.
Tax Lien Seminars considers buying tax lien as good investment. Here are some valuable pointers and useful tips to enjoy your ROI from your TAX LIEN Investment:
In some states, like Texas investing in tax lien can give you as high as 30% interest and penalty in six months. In other states, it is anywhere from 18% to 36% a year. With a Tax deed your investment could give you an ROI beyond your wildest dream. Here’s how it works:
TAX LIEN CERTIFICATE:
An investor buys the unpaid or delinquent taxes plus interests and penalties of a property in a tax lien auction sale. This simply means that you do not own the property and the owner has the right to redeem his property by paying back your investment plus interest and penalties within a certain amount of time set by the state or county where you bought the certificates.
Sometimes it will cost you about a hundred bucks or a bit more to pay for the delinquent taxes of a property, depending on its value, size and location. Assuming you paid $500 and the owner redeems his property after three years, your ROI could reach as much as 300% since some subsequent taxes will be added.
Remember that you only paid for the delinquent taxes, which could either be for the past 2 or three years. Which means that current and subsequent taxes should also be paid. Why?!
To avoid any complications, assuming the owner did not redeem his property, and someone comes claiming some tax lien on the property simply because you did not pay the current and subsequent taxes.
In most cases, the value of a foreclosed property is way, way above the amount you paid for the tax lien, assuring the investor very handsome dividends or ROI.
TAX DEED SALE:
Texas is one of best states in buying tax deeds because you are the owner of the property after you purchased and recorded the deed. In other states, you are not the owner until the redemption period is over.
Even if the deed is redeemable in Texas, you can rent out the property immediately or you can even evict if there’s someone living there. Yes, of course the previous owner has the right to redeem by paying 25% penalty within 6 months. That, indeed, is a humongous return of investment.
There was an instance when a property that cost the investor over $20,000 and the owner failed to redeem the property within the redemption period. With some minor repairs the Investor was able to net $178,000.00 after paying the commission of the agent and other incidental expenses.
Remember also that when you buy a tax lien, somebody owns the property and you cannot just go inside as that is trespassing. Maybe, you can just drive a little closer and take a look if it’s really there. Just be sure that the amount you paid for the lien is much less than the assess value of the property, or at least the land, since some improvement might have less value or would have been razed to the ground.
At the end of the day, Texas is not the only best state to invest. If you are living in another part of the country far from Texas, it’s too inconvenient and impractical to fly there every time. Besides, a state with a very high interest rate means the competition is very stiff also.
Finally, Tax Lien Seminars suggests that the best place to invest in tax liens is where you’re quite familiar with the value of the property you have in mind. This could be either where you live or at places where you go on vacation or where relatives or friends dwell.