Every county that holds a tax lien or tax deed auction has a set of rules to guide buyers. So, every single time I study a new market, I check two best practices off of my to do list. Admittedly, the first step has multiple small steps within it…but you will get the idea.
Locate the auction rules or guidelines. In addition to the rules, there will usually be a webpage or document containing FAQ’s or commonly asked questions. I recommend bookmarking these guidelines in your web browser in addition to printing them out and reading them very carefully.
If you develop any additional questions that are not answered in the rules and additional documents provided, then write them down or type them into your market research notes. It is important to make note of everything. This should be self explanatory, but I have encountered many non-note takers in the past. So my response to this behavior is that you cannot possibly remember every detail of every market. So write it down, because when the next auction is scheduled in a month, two months, or even a year…you will need a refresher.
Now, read through it all again. And then, do it again. This may seem redundant but it is amazing what we miss on the first, and even the second look. Continue to reference the rules until you get to the point where you feel like you could teach a class on the subject.
Now, I know more often than not auction rules are difficult to understand and even ambiguous at times. So call the county and ask the questions that you have already noted. Be ready to write down the answers clearly for future reference. If you happen to reach an inexperienced staffer at the county, politely ask whom you may speak to who will be able to help you. Do this graciously; if you offend the county worker you are less likely to get the answers you need.
For further digging and to acquire a deeper understanding, look at the county or state statutes regarding tax deed or tax lien sales.
These can prove useful when researching what encumbrances may survive, what it takes for a property to make the auction list, or the sale advertisement procedures, dates, etc…
I entreat all of our students to complete best practices before making a tax lien or tax deed purchases. Don’t assume anything without completing your due diligence. Be regimented with your research and you will succeed.