An Explanation Of Real Estate Tax Sales

You, as a homeowner are responsible for paying your property taxes. The tax authority may take legal action against you if you fail to pay your property taxes. This usually takes the form of a property sale. There are two types of property tax sales.

Tax lien sales are where the tax authority (usually the county) offers its right to the tax lien. To make a profit, the buyer of the lien can then exercise the lien.

A tax deed sale is when the county gives full ownership to the property for sale.

Bidding on tax lien sales is a bid for the tax debt. A tax lien sale does not result in you owning the property. You will actually be paying off the tax debt of the owner in exchange for the first lien position on title. You now have the homeowner's tax debt. This is in addition to any mortgage lenders, trust deeds, or other claimants on the property. The tax lien is sold at public auction. The buyer is issued a tax lien certificate to verify the position.

The buyer can now consider an interest penalty of sixteen to twenty-four per cent if the homeowner defaults on their tax lien debt. This is when buying tax liens can be very profitable. The buyer can foreclose on the property and take back the tax lien debt if it is not paid in full plus interest within a specified time.

You are buying the property at a tax sale. Commercial Real Estate The highest bidder wins the property. You can take possession of the real property without any mortgages, trust deeds, liens or other obligations attached. These auctions usually sell properties for the taxes owed plus any fees or court costs. These auctions are a great way to get excellent real estate deals.

It is best to check the website of your county government office to determine where and when tax lien sales and tax deed sales take place.

Be sure to thoroughly review a property before you buy it. Before you buy a property, make sure to inspect it thoroughly and determine its worth. As much as possible, you want to protect yourself from risk. You're familiar with the saying, "Buy a pig in an egg."