The following is an excerpt from a book published in 2016. Investment secret of tax lien: how to obtain 8~36% capital return without typical risks of real estate investment or uncertainty of stock market? Chapter 3 of this section: looking for the best investment location
Six things to know
Before you begin, you need to know 6 information about tax liens or tax bill investments.
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Statutory interest rate – This is the interest rate charged by the county to taxpayers who have overdue taxes. It is the interest rate that investors get when the tax sales are not reduced.
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Bidding method – no matter what is actually bidding in tax sales, whether it is bidding for payment of lien amount, interest rate, or other complete bidding, do not invite bids at all, and randomly select the winner.
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Repurchase Period – The period during which the property owner must repurchase the lien or repurchase contract before the lienee can repurchase the property.
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Expiration time -; “Life”; if the investor does not take any measures, the lien will become invalid.
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Subsequent tax treatment method – if the property owner does not pay, whether the lien owner should pay the subsequent tax and the interest or penalty paid for the subsequent tax.
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Additional penalties – will lien holders be subject to additional penalties when repurchasing liens or repurchases?
These six things will have a great impact on your profits. This is also the reason why tax lien investments in other states vary greatly. Take three different states for example. These states all have auctions with reduced interest rates. However, due to the other five factors mentioned in this chapter, the investment in each state is very different.
