Finding A Gem In Real Estate
No matter what level of real estate investment you are on, everyone is always looking for that house that ‘didn’t cost much.’
We’ve discussed before places to find deals on homes and real-estate; one such place is a foreclosure due to a tax lien.
A tax lien is where a local government places a lien on a home due to back owed property taxes. This can happen for many reasons, but the most part it’s because the taxes are being paid by the owner because there is no mortgage on the property.
If you are able to find a property with an expired tax lien, you can often buy the property for the price of the back taxes.
If the lien does not redeem, you may get the property for little more than one or two years of back property taxes. While this situation is very rare, it does happen. In most states where liens are levied against properties when their owners fail to pay their taxes, the foreclosure process does not involve a public sale of the property but only a statutory requirement to send certified letters to the owner and lien holders — and typically a notice in the legal section of the local newspaper.
Keep your eyes out for deals of this kind. You can also offer to pay the lien on the home and continue to rent the home to the current owner at a ‘lease-purchase’ rate with an agreement to return the home to them after a certain amount of time.