How to Acquire Properties for the Back Taxes & Penalties Only

Written by Tony Martinez

Here’s how…

Yes, properties can be acquired for the price of the back property taxes and penalties only through our specialized tax lien investment strategies.

This property was acquired for only $5,026 total purchase price, and is owned free and clear with no mortgage:

The strategy we used to acquire this property is one of our proprietary “Get the Property” strategies called TRP-OTC Tax Deed Property Acquisitions®.

Please don’t worry about the long title for right now. I’ll explain the process in this lesson.

Tax Lien & Tax Deed Properties to Target for Acquisition

As I’ve mentioned in other lessons, through our research systems, we target and identify non-homestead properties, which means the properties we focus on are not a person’s primary residence. After three decades of expert investment experience, we know that homeowners simply don’t lose their primary residence for a few hundred or few thousand dollars in back property taxes.

This property was owned by an investment LLC that owned several properties throughout the state.

At the time of acquisition, there was a tenant living in the property who was paying rent, but the property owner (LLC), which appears to be an investment group, hadn’t paid property taxes in over 9 years.

When we took title to the property, our property manager met with the tenant, shared with them our recorded documentation to prove we owned the property, and simply had the tenant sign a new lease agreement with us. It was a fairly seamless process, and that tenant is still living there today.

Here’s the Process on How this Property Became Available for the Price of the Back Property Taxes & penalties only:

1. The property owner becomes 1 year delinquent on their property taxes.
2. The county government offers a tax lien certificate on the property at their annual tax lien certificate sale that pays 12% interest per year with a 3 year redemption period (grace period).
3. The tax lien certificate sale in this one county has 16,000+ tax lien certificates available.
4. Several thousand tax lien certificates from this tax lien auction will go unpurchased in just this one county.
5. The unpurchased tax lien certificates then become county held tax lien certificates and are available for purchase “over the counter” directly from the county through a strategy called “Assignment Purchasing.”
   
   
6. The redemption period begins, i.e. the clock starts ticking on the 3 year redemption period the date of the auction.
7. Every day the tax lien certificate remains in the county’s inventory counts toward the redemption period expiring.
8. When the redemption period expires on all of the county held tax lien certificates, those tax lien certificates are then transferred (sold-off) to a state government agency and in the process turned into a deed to the property.
9. This total process takes approximately 5 years from the day the property owner became delinquent on their property taxes to the time the deed to the property is made available to the public, which gives the property owner ample time to pay their property taxes.
10. In this one particular state, there are currently over 18,000 tax sale properties (deeds not liens) currently available for purchase.
    
    
11. Properties can sit on this tax deed list for several years without ever being purchased because most people don’t know how to complete thorough research, identify the valuable properties, and take those properties through the acquisition process specific to tax lien investing.
12. Although the properties have been sold off to a state entity and turned into a deed, while the properties remain on this tax deed list unpurchased, the property owner can still redeem, i.e. pay their back property taxes, and retain their property. In these cases, property owners have several years beyond the redemption period to pay their delinquent property taxes.
13. Once proper research is completed, and a property is identified for purchase, an online application for the property is then submitted.
14. Through the specific process I’m describing here, the price of the property is determined by the government agency by calculating the delinquent property taxes, penalties, and interest owed for the number of years the property has been delinquent. This price is then sent to the applicant / investor via a “price quote” and offer for purchase.

Yes, it is possible to acquire valuable real estate assets for the price of the back property taxes, penalties, and interest only, and this is just one of the systems that we’ve developed to help our beginning clients start acquiring valuable real estate assets for a fraction of the fair market value of the property.

I know of no other real estate investment strategy that gives people the opportunity to enter the lucrative world of real estate investing with a lower initial investment that tax lien investing.

It’s important to remember that acquiring real estate at huge discounts through the power of tax lien investing is completely different than conventional real estate strategies like foreclosures, or wholesaling, or fix and flip.

What Beginning Tax Deed Property Investors Must Know First

It takes specialized knowledge, and this specialized knowledge can be learned.

Another very important factor is that each state has their own unique system for collecting delinquent property taxes, and the rules and procedures can also vary county to county.

The research systems, processes, and methodologies are critical because every type of derogatory property you can imagine is on the list, too, and you must know how to identify viable properties and complete thorough research and analysis, so you can safely take title to highly profitable real estate deals.

I know this may start to sound a bit complex, but it really isn’t, it’s simply different than conventional real estate investment strategies.

Yes, it takes time and yes it takes effort, all strategies that create financial freedom do. And, it’s also worth it for those who are committed to achieving their financial goals so they can live life on their terms.

The Benefits of Tax Deed Property Investing for Beginner’s

Real estate is a hard asset and continues to be one of the greatest vehicles for creating true financial freedom and remains one of the number one assets of millionaires in America.

Every year, there are over 10,000 tax lien certificate and tax deed property sales, there are currently tens of thousands of properties currently available that can be acquired directly through our specialized “from-home” investment strategies, and every week, new properties are added to inventories.

Tax lien investing gives beginning investors with limited capital who truly desire ultimate financial security the opportunity to begin investing in valuable real estate assets and it doesn’t take hundreds of thousands or even tens of thousands of dollars to get started.

Ready to Learn More

There’s plenty of inaccurate and misleading information regarding tax lien certificate and tax deed property investing in the marketplace, and this lesson was designed to give you a detailed description of just one process of how properties become available and can be acquired for the price of the back property taxes, penalties, and interest only.

To continue learning how you can get started right and begin successfully investing in tax lien certificates and tax deed properties, please continue exploring our invaluable free learning resources on our website.

For a more comprehensive in depth training for beginner’s, we’re also giving you Immediate Free Access to our self-paced 3-Module Online Video Tax Lien Investing Crash Course.