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Read about the Tax Title Process in Massachusetts: here
Tax Lien Millionare
Buy Properties for Pennies on the Dollar
Visit: MassTaxDeeds.com
Massachusetts Bidders should be aware that they will not be bidding to purchase
marketable title to land. The successful bidder will acquire all of the Town/City's
rights in the subject Real Estate, specifically the right to institute proceedings
in the Land Court to foreclose the rights of the delinquent taxpayer. An Assignment
Auction is held under the provisions of Massachusetts General Laws Chapter 60, Section 52.
Presently, a 6 month Redemption Period or more must elapse. The assignee is entitled
to collect only 6.5% interest, not the 16% owed to a municipality under G.L. Ch. 60 §62.
Tax Lien Millionare
Buy Properties for Pennies on the Dollar
Table of Contents
Introduction: Why Invest In Tax Liens? Page 3
Chapter #1: What Are Tax Liens? Page 7
Chapter #2: How To Buy Tax Lien Page 14
Certificates
Chapter #3: Colorado – An Example Of Page 36
A State That Sells Tax Lien Certificates
Chapter #4: Useful Tips On Buying Tax Lien Page 49
Certificates At Tax Sales
Chapter #5: The Risks Involved In Tax Lien Page 70
Investing
Chapter #6: List Of States That Sell Tax Page 75
Lien Certificates
Chapter #7: States Where Tax Lien Investing Page 78
Is Most Profitable
Chapter #8: Contact Information For The Page 83
Most Profitable Tax Lien States
Conclusion: Tax Lien Certificates Are An Page 87
Excellent Investment
Introduction: Why Invest in Tax Liens?
Page 3 of 89
Introduction: Why Invest in Tax Liens?
Looking for a safe, easy, guaranteed investment
with high rates of interest, without the risk
of stock market investing? Stop putting up with
mediocre investment returns and stock market
risk. This comprehensive guide will show you
how to achieve the maximum financial gain in a
time of low interest rates and a weak stock
market.
Like millions of others, you probably worry
about where to put your money in these shaky
stock market times. Instead of investing in
stocks, many people choose to invest in their
money in “safe investments”, like certificates
of deposit or savings accounts. The problem is
money market funds, banks, and savings and
loans are paying less than 5% interest. Today,
you will have to search for a CD paying more
than 6%. After taxes and inflation, a 5% or 6%
return leaves you with nothing at all!
There is another option. Suppose you could
learn exactly how to get started buying
property tax liens and get a guaranteed return
on your investment by Uncle Sam himself,
without the high risk from investing in the
stock market or the low rate of interest on CDs
or money market accounts?
Buying property tax liens from the government
is one of the most powerful and safe
investments you can make, because you will get
a guaranteed rate of return on your investment
backed by the government itself! Simply put,
it’s probably the best kept secret in
investing.
Introduction: Why Invest in Tax Liens?
Page 4 of 89
Sound too good to be true? Well, it isn’t if
you have the right information on how to buy
tax liens in states where tax lien investing is
the most profitable.
In states like Michigan and Arizona, buying tax
liens is especially profitable because the
state pays an exceptionally high interest rate
to lien holders, and provides them with a high
level of security. In fact, 98 percent of tax
liens are eventually paid off. And if the
delinquent property owners don’t pay back their
tax liens, lien holders automatically get the
chance to foreclose on the property and get the
title to it after 1 to 3 years – for little
more than the money they paid for the tax lien!
Tax lien certificates aren’t some shady
investment that you buy from a broker at an
investment firm you’ve never heard of. You
purchase these property tax liens directly from
the state or county government (depending on
the state). The government isn’t going to close
up shop or leave town. This type of investment
was created by state law, and state law
protects you as the investor.
Simply put, buying property tax liens is
probably the best kept secret in investing,
it’s safe, and it’s not difficult to do.
Investing in Tax Liens Is Easy…Learning How To
Actually Get Started Is The Hard Part
It could take you hours and hours of research
and could cost you a small fortune in phone
bills, attorney fees and travel time to figure
out the exact details on how to get started
Introduction: Why Invest in Tax Liens?
Page 5 of 89
investing in property tax liens, especially
since the information is different for every
state county.
But instead of knocking yourself out trying to
figure out how to invest in tax liens, spend an
hour reading this informational report and you
will learn what tax liens are, the information
you need to get started investing in them, and
the tools you need to implement a successful
investment strategy.
In this report, you will also get a list of the
27 states in the continental U.S. that sell tax
lien certificates, and you will discover which
of these states is most profitable for tax lien
investing.
And, remember, you do not have to live in a
particular state to buy their tax liens for
sale. Even if you live as far away as New York
or Texas, you can still invest in tax liens in
Florida, Arizona, Illinois, Michigan, or any of
the other states profiled in this report. It’s
also an easy thing to do from another state.
Much easier, in fact, than trying to keep track
of your stock market investments.
Think you need to be rich to invest in tax
liens? Think again. One of the great things
about tax lien investing is that tax liens come
in a range of prices from $100 and up, and,
since you can buy just what you need, there is
sure to be a tax lien to suit your budget.
Learn everything you need to know about tax
liens in this concise, easy-to-understand
report and get started now on your path to
Introduction: Why Invest in Tax Liens?
Page 6 of 89
safe, high-interest, low-risk investment
returns guaranteed by the government.
Section #1: What Are Tax Liens?
Page 7 of 89
Section #1: What Are Tax Liens?
By definition, a lien is a legal term
pertaining to the right to gain possession of
someone else’s property until the owner of the
property fulfills a legal duty to the person
holding the lien, such as payment of property
taxes.
With property tax liens, local governments have
the right to lay claim to people’s property
when they do not pay their property taxes.
Why don’t property owners pay their property
taxes?
The most common reason why an owner doesn’t pay
is because they do not have enough money for
the taxes, or the owner is just putting off
paying them. Whether they’ve recently lost
their job or are simply strapped for cash, some
people fail to pay their property taxes, just
as they might fail to pay their electric or gas
bill.
The problem is local governments depend on the
revenue generated by property taxes to provide
services and run their day-to-day operations,
like repairing roads, funding schools, and
paying for law enforcement. Property taxes can
make up to 50% of a county’s revenue. If
property taxes do not arrive on time, many
county governments find it difficult to budget
or even function without this income.
In order to make up for the shortfall,
governments have to raise the missing money
somehow – even if it means raising the property
Section #1: What Are Tax Liens?
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taxes of citizens in the community who pay
their property taxes on time. Of course,
elected county officials don’t want to raise
taxes on their constituents because they know
it will come back to hurt them when they run
for re-election.
Another option is that counties can, and do,
charge high penalties to delinquent property
owners for failure to pay, and they have the
power to foreclose on the property. The
problem with this solution is that while the
government pursues the delinquent taxpayer, it
is without its money.
The other alternative is to place a lien on the
owner’s property. Just as a utility company can
shut off you’re your lights or gas if you don’t
pay your bill, local governments have the right
to take similarly drastic measures against
delinquent taxpayers.
Here’s how tax liens work:
A county government places a lien on a piece of
commercial or residential property or vacant
land when the owner of the property does not
pay their property taxes. This means that the
tax obligation is officially registered in the
county tax records. Until the taxes are paid
off, the lien, remains in effect, which means
that nobody can buy the property without paying
off the lien. The amount of the lien equals the
amount of the unpaid taxes, plus penalties and
interest.
Section #1: What Are Tax Liens?
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If the property taxes remain unpaid for a long
enough period of time, the county can foreclose
on the property and take possession of it. In
the meantime, the county charges an interest
penalty on the amount of the unpaid taxes
ranging anywhere from 8% to 50% per year!
Tax Lien Certificates
A lien is a very effective legal tool designed
to force debtors to pay their bills.
The catch is counties don’t want liens - they
want cash so that they can keep the government
running. With liens, counties must still foot
the bill until the owner pays his/her taxes and
most cannot afford to do this. Small, county
governments are not in the lending business and
they do not have money to loan.
Instead of holding the lien until the property
owner finally pays their taxes, many states
allow their county governments to sell off
these liens at county-sponsored tax sale
auctions in the form of tax lien certificates.
Tax lien certificates work like this: To get
their money quickly, counties sell their liens
to nearly any private citizen in any city or
state who wants to buy them, and then issue
certificates for the liens. States that offer
tax lien certificates generally hold a tax sale
auction at least once a year where buyers bid
to purchase these tax lien certificates.
The purchase price of the individual tax liens
sold by local governments varies, but you can
expect to pay exactly the amount of the
Section #1: What Are Tax Liens?
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delinquent taxes, plus the interest and
penalties already owed to the county by the
property owner.
Once you buy the lien, you have the same rights
to the property as the government. You not only
get to collect the principal amount of the
lien, but the hefty interest that continues to
add up until the lien is paid off in full.
In addition, like the government, lien holders
automatically get the chance to foreclose on
the property and get the title to it after a
certain period of time – for little more than
the money they paid for the tax lien.
Individuals have been buying up property tax
liens more and more because of the great
benefits.
When you purchase a tax lien, you get:
• The amount of the unpaid taxes owed by
the property owner.
• All outstanding interest accrued from
the time of the sale.
• Additional fees charged by the county,
like filing, advertising, and other
administrative fees.
• Title to the property (after a certain
amount of time set by the state
jurisdiction) if the delinquent taxpayer
fails to pay up.
Section #1: What Are Tax Liens?
Page 11 of 89
Why Tax Lien Certificates Are a Safe Investment
Don’t worry, tax lien certificates are not
another invented, get-rich-quick scam. They are
part of a government-sponsored program that
serves to protect the financial interests of
county governments as well as your interests.
They not only offer you a high-rate return on
your investment, they also provide a great
opportunity to obtain real estate at incredibly
low prices. In fact, your rights are set into
law by state legislation.
As mentioned previously, as the purchaser of a
tax lien certificate, you automatically receive
the same rights of the government over the
property, including:
• The right to collect the lawful interest
on the unpaid taxes. The delinquent
property owner has to pay you the
interest set by the government from the
day of sale.
• The right to foreclose on the property
and take possession of it.
• The right to live in the property once
you take possession of it. If you choose
not to live in it, you can lease it out
to tenants or sell it.
You know the old saying, “The only certainties
in life are death and taxes”. Have you ever
heard of the IRS forgiving or forgetting about
a tax debt? It never happens. The IRS levies
Section #1: What Are Tax Liens?
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heavy penalties and interest on people who do
not pay their taxes, and can seize the
taxpayer’s assets to pay the debt once enough
time has passed. The same holds true with tax
liens.
Without question, people must pay taxes on
property they own to their local governments.
If they do not pay when these taxes are due,
they will be charged penalties plus interest on
the unpaid taxes. If delinquent taxpayers fail
to pay their property taxes after a certain
amount of time, they will lose their property
to the government or to you, if you hold the
tax lien certificate to the land.
An important point to remember is that as the
holder of the tax lien certificate, you will
not be responsible for pursuing the delinquent
taxpayer to get him to pay you back his debt to
you. That is what the lien is for. Think of it
as insurance that protects you against the loss
of your money.
Once you purchase a tax lien certificate, you
can feel confident that you will not only get
the money that you paid for the tax lien back
in full, but you will also earn a high interest
rate of interest on your investment. Not to
mention you might even get to obtain property
at unheard-of bargain prices!
If you invested $3,000 in the stock market, you
cannot be sure you will earn a high rate of
return over, say, 10%, or, for that matter, any
return at all. You could actually lose your
hard-earned investment in the stock market!
Section #1: What Are Tax Liens?
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Most people participate in tax lien sales
because the interest rates are much better than
those offered in savings accounts, mutual
funds, Certificates of Deposits, etc. Also,
unlike the stock market, you can be sure you
will make money by investing in property tax
liens because they are guaranteed by the
government.
Section #2: How To Buy Tax Lien Certificates
Page 14 of 89
Section #2: How To Buy Tax Lien Certificates
Now that you know what tax liens are, you are
ready to learn how to buy them, the information
you need to get started, and the expert tips
you need to know to be successful.
The following is an outline of the steps
involved in buying tax lien certificates. Keep
in mind that this is only a general overview of
the process - each state will differ in their
exact procedures.
1. Tax Notices Sent to Property Owners
During different times of the year, state
counties send out tax notices to property
owners. If property owners do not pay their
taxes by a certain due date, state counties
then send letters to these property owners
alerting them that their taxes are
delinquent.
2. County Files Lien on Property
If the delinquent property owners do not
respond to the county’s notice and pay
their taxes, the next step is for the
county to lien the person’s property.
Typically, counties send another letter to
the delinquent property owners to notify
them that a lien has been filed on their
property, and to tell them that this
property tax lien will be sold at a tax
sale (or a tax lien auction as they are
also referred to).
Section #2: How To Buy Tax Lien Certificates
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3. Advertisement of the Sale
States that offer tax lien certificates
generally hold a tax auction (where the tax
lien certificates are sold) at least once a
year. Each state holds their auctions at
different times of the year. Sometimes,
individual counties within a state will
hold their tax auctions in the same month
of the year, but on a different date.
Nevertheless, the laws of each state
require that the date and time of the
auction be advertised in local newspapers
before the day of the sale.
For example, in Colorado, a list of tax
liens available for purchase is advertised
in three to four weekly issues of local
Colorado newspapers, like the Daily
Sentinel in Mesa County, or the Pueblo
Chieftain in Pueblo County.
Besides the date and time of the sale, each
state’s law also requires the list of
properties be published in the local
newspaper prior to the day of the sale.
This list generally includes some sort of
description of the property, their
locations, and the amount of the taxes
owed.
Although tax auctions are publicly
advertised in local newspapers, you
probably don’t want to go to the trouble of
subscribing to these publications or
figuring out when to buy them at a
Section #2: How To Buy Tax Lien Certificates
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newsstand. There is another option: call
the county treasurer’s office.
Tax lien certificates are usually handled
by the county treasurer’s office, which is
the governing body that oversees tax
collection and tax liens. As soon as you
have determined the state and the county
you want to buy in, you should contact the
local county treasurer to find out the
date, time, and place of the next auction.
Most county treasurers will also mail you a
copy of the list of properties being sold
at the auction for free (or for a nominal
fee). If you live nearby, you can usually
pick up a copy from the county treasurer’s
office as soon as it is published. Some
counties even post their tax sale list on
their website.
Getting a copy of the list of tax liens for
sale is very important, which will be
discussed on page 57 of this report under
“Research the properties”.
Picking up the phone and calling a county
treasurer’s office is easy but how do you
find out what number to call? Simply go to
page 83 in Section #8 of this report,
“Contact Information For The Most
Profitable Tax Lien States”, which lists
phone numbers to help you get started. You
can also call directory information to get
the numbers you need.
TaxLienSaleCertificate.com also offers
County Phone Lists, which give you the
Section #2: How To Buy Tax Lien Certificates
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name, phone number, and address of every
single county in states where tax lien
investing is most profitable.
4. The Day of the Tax Auction
States generally have very explicit
procedures for their tax auctions. For this
reason, it is very important that you check
with the county where you want to purchase
a property tax lien to find out what their
particular requirements are.
Tax Sale Proceedings
Here is a general summary of tax sale
proceedings:
• For the most part, each and every county
in the states that sell tax lien
certificates hold auctions. Furthermore,
these states do not hold one just one
yearly state auction where they sell all
their county tax liens. With the huge
number of tax liens available for
purchase in these states, this process
would take far too long and too many
days to complete. That is why individual
counties in each state sponsor their own
tax sales.
• You do not have to be a resident of a
particular state in order to participate
in their county tax auctions. States
that sell tax lien certificates allow
any private citizen like yourself living
Section #2: How To Buy Tax Lien Certificates
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in any city or state outside of their
jurisdiction to participate.
• All states require that you must be
physically present at the county tax
sale to bid. Some states even allow you
to send a representative to bid for you.
If you plan to bid in a state where you
(not your representative) must be
present during the tax sale, make sure
the state is in close proximity to where
you live, or else it is a state you
would like to visit.
• Each county tax sale takes place in a
county building, like the County
Courthouse or the County Treasurer’s
Office. Again, you must check with
individual counties to find out where
they hold their tax sales.
• Keep in mind that when you purchase a
tax lien certificate, you are purchasing
the tax lien on the property only - you
are not purchasing the property. A tax
lien certificate does not give you right
to ownership, use or access to the
property.
• Registration
Registration procedures vary among
states so be sure to find out this
information for the state in which you
plan to purchase tax lien certificates.
► In some state counties, registration
begins an hour or two before the sale
starts. Some counties allow (and
Section #2: How To Buy Tax Lien Certificates
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strongly encourage) pre-registration
prior to the actual sale date. They also
permit registration by mail. It’s always
best to arrive at a tax sale as early as
possible to get the best seat in the
house.
► During registration, you will have to
fill out a registration form, as well as
other forms such as an IRS W-9.
► Some states require that you make a
deposit on the day of the sale in the
form of cash or a certified check.
For example, in Colorado, you must
deposit the amount you wish to invest.
If you have not spent the entire amount
you deposited during registration, you
will receive a check from the county the
week following the tax lien sale.
Other state counties require a fixed
deposit, like in Miami, Florida, where
you must pay a $1,000 deposit which you
will get back in a month if you buy no
certificates. Some counties will also
allow you to estimate the amount you
will buy and deposit 10% of that.
• Bidding
Why do buyers have to bid on tax lien
certificates in order to buy them? Like
any auction, buyers are competing to
purchase tax lien certificates, which
are the items for sale.
To buy a tax lien certificate, you can
expect to pay exactly the amount of the
Section #2: How To Buy Tax Lien Certificates
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delinquent taxes, plus the interest and
penalties already owed to the county by
the property owner.
So, in most states, what you are bidding
for is the amount of interest you are
going to require the property owner to
pay you. However, that doesn’t mean you
can set a random price for a tax lien
certificate.
For example, the bidding price of a tax
lien certificate starts at the exact
amount of the delinquent taxes, plus the
penalties and interest already owed to
the county by the property owner. What
you are bidding for is the amount of
interest you are going to require the
property owner to pay you.
Types of Bidding
Most states generally award a winning
bid to the person willing to accept the
least rate of interest as is the case in
Florida, which is one of the states
where buying tax lien certificates is
very profitable.
In fact, in Florida, all tax lien
certificates not sold at the auction can
be bought from the county, and will draw
a full 18% without bidding! If you don’t
want to compete with other bidders on
the amount of interest you will accept
on a Florida tax lien certificate, you
can just wait to buy a “leftover lien”
to collect the entire 18% interest. (For
more information on leftover liens, go
Section #2: How To Buy Tax Lien Certificates
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to page 66 of this report in Section #4:
“Useful Tips On Buying Tax Lien
Certificates At Tax Sales”).
Not all states let buyers bid on the
least rate of interest on a tax lien
certificate. For example, in Colorado,
you have the winning bid if you are
willing to hand over the most cash to
the state. That is, the tax lien
certificate goes to the person who pays
the unpaid taxes, interest, and
penalties owed, plus the largest amount
of cash, which is called a premium bid.
In Michigan, buyers bid on the
percentage of ownership in the property
for which the tax lien certificate is
held. So, if you successfully bid 80%
ownership on a property for which you
hold a tax lien certificate, in the
event the property forecloses and you
get the property, you will have to share
ownership with the delinquent owner, who
holds the other 20%. This may not sound
like an ideal arrangement but keep in
mind that Michigan yields a high rate of
interest on their tax lien certificates.
• Purchasing the Tax Lien Certificate
Once you’ve placed the successful bid on
the tax lien certificate, you will then
need to pay for it. States are very
specific about when you owe the money
and how you must pay it.
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For example, in Florida, a nonrefundable
5% to 10% of the final bid price is
required at the time of the sale. The
balance of the bid price must be paid
within 48 hours. If payment is not
received within 24 hours, you will lose
your deposit.
Other states require payment by the next
day, or before the conclusion of the
sale. If you fail to pay, the tax lien
is auctioned off again.
6. Redemption of Tax Lien Certificates
Once you buy a tax lien certificate, the
next step is to wait for the lien to be
paid back to you by the delinquent property
owner. Simply stated, to redeem a tax lien
certificate (or the redemption of a tax
lien certificate) means to pay it off.
The delinquent property redeems the tax
lien by paying you back all of the money
that you paid to purchase the tax lien
certificate, including:
• The amount of the delinquent taxes, plus
the interest and penalties already owed
to the county by the property owner.
• Any additional fees charged by the
county, like filing or other
administrative fees.
• All outstanding interest accrued from
the time of the sale.
Section #2: How To Buy Tax Lien Certificates
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In most states, when the tax lien
certificate is redeemed, you will get paid
back 100% of what you paid for the tax lien
certificate, in addition to the outstanding
interest that has accumulated from the date
you bought the certificate at auction.
How long does it take a delinquent property
owner to redeem the tax lien?
Redemption of a tax lien certificate can
take anywhere from 1 month to 30 months or
longer. But don’t think that means that a
property owner has an unlimited time to
redeem a tax lien, because that is clearly
not the case. Redemption periods range
state to state. For instance, in Colorado,
a property owner has 3 years to redeem,
while in Florida, it’s two years.
What happens after the redemption period
has ended? The next step is for the holder
of the tax lien certificate to apply for a
deed, which gives the holder of the tax
lien certificate right to take possession
of the property if the owner fails to pay.
Deeds are covered in more detail on page 32
under, “What You Can Expect In Court”.
In regard to the redemption process, if
you’re interested in getting paid for your
tax lien certificate, don’t worry, one of
the best features of tax lien certificates
is you don’t have to do a thing to get your
money back. You do not, for instance, have
to pursue the delinquent property by
calling his home like a debt collector
would. All of the work of processing the a
Section #2: How To Buy Tax Lien Certificates
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redemption is done for you by the local
treasurer for free.
How Tax Lien Redemptions Work:
If the property owner decides to pay off
the lien, he does not contact you. Rather,
he goes to the treasurer’s office and pays
the delinquent taxes, as well as the
penalties and interest.
After the property owner redeems the lien,
the treasurer sends out a letter notifying
you that the lien has been redeemed, and
that you should send in the certificate.
After the treasurer receives the
certificate from you, he mails you a check,
which includes the amount of the tax you
purchased plus the interest that has
accrued from the day of the sale to the
date of redemption. In counties where the
treasurer keeps the original certificate on
file, he just mails you the check.
The total amount of the check you receive
is determined by the length of time you’ve
held the tax lien and how much interest
(and penalties) the delinquent taxpayer is
being charged.
For example, to give you a rough idea of
how much money you can make, let’s say your
tax lien certificate is worth $1,000 at an
interest rate of 15% per year and the
property owner redeems or pays back the
lien in 18 months.
Here is the calculation:
Section #2: How To Buy Tax Lien Certificates
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18 months x 1.25% (divide 15% by 12 months,
this is the monthly amount of interest you
earn) = 22.5%
You would earn 22.5% interest on your
$1,000 investment or $225. Compare that to
the 6% or $60 you would make by investing
$1,000 in a Certificate of Deposit!
Or consider this scenario: Your $1,000 tax
certificate earns 15% interest per year and
the payback time is 30 months. The property
owner will owe you 1.25% per month for 30
months or 37.5% interest. So, if the amount
you paid for your bid is $1,000, you will
earn $375!
If your tax certificate lien certificate is
worth more, let’s say, $2000, and your
interest rate is higher at 18%, you will
earn even more money.
Here is the calculation for $2,000 tax lien
certificate held for 30 months at an 18%
interest rate:
30 months x 1.5% (divide 18% by 12 months,
this is the monthly amount of interest you
earn) = 45%
You would earn 45% interest on your $2,000
investment or $900.
You may think 2 and a half years (30
months) is a long time to wait to earn
money on your investment, but it would take
you much longer to earn this kind of
Section #2: How To Buy Tax Lien Certificates
Page 26 of 89
interest in a money market account or
Certificate of Deposit.
It is important to note that it is not
unusual for a delinquent property owner to
wait two years or longer before redeeming
the lien. This is to your advantage because
the longer he waits to redeem the lien, the
more money you get in interest.
Tax Lien Redemptions: Change Your Address
With The Treasurer’s Office If You Move
Nevertheless, if you move during this time,
be sure to notify all the treasurers in
counties where you hold tax lien
certificates of your new address.
To make this easy to remember, always keep
a list of your tax lien certificates,
including parcel numbers, certificate
numbers, and the names and addresses of the
county treasurers. When you change your
address, call and write a letter to the
different treasurers to notify them of your
address change. That way, the treasurers
will know where to mail you a check when
your tax lien certificate is redeemed.
Getting the check from a county treasurer’s
office is one of the financial rewards you
will reap by investing in tax lien
certificates. This check will be much
larger than the money you paid for the tax
lien certificate. And, unlike the highs and
lows of stock market investing, the money
you make off your tax lien certificate is
not the result of chance, but a guaranteed
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investment that you can do over and over
again with the same high return.
Endorsing Subsequent Years Taxes
Some states allow tax lien certificate
holders to endorse subsequent years taxes
(called sub-taxing).
What Is Sub-Taxing?
Each year following the purchase of your
original certificate, if the same property
owner has not paid their current year taxes
in the timely manner required by law you
have the first option of adding that next
year’s delinquent taxes to your original
tax sale certificate (referred to as
endorsement).
You can endorse the taxes on to the
certificates you already hold without
having to go through the trouble of
attending another tax lien sale. The
subsequent tax year payment will earn the
same rate of interest as the original
certificate and will accrue from the date
of payment.
Endorsements are processed at different
times of the year by county treasurers. You
will be notified by mail before this time
if you are eligible for endorsements on
your tax lien certificate(s).
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7. Foreclosure
What happens if the delinquent property
owner does not redeem (or pay back) the tax
lien certificate within the redemption
period?
If delinquent taxpayers fail to pay their
property taxes after a certain amount of
time, they will lose their property to the
government or to you, if you hold the tax
lien certificate to the land.
As mentioned previously, the redemption
period, or the amount of time a delinquent
taxpayer has to pay the tax lien
certificate before his property is
foreclosed on, is different in each state,
but the range of time is typically 1 to 3
years, as mandated by state law.
Once the redemption period has passed
after, let’s say, 3 years, the next step is
foreclosing on the tax lien, which means
the holder of the tax lien certificate
takes possession of the property.
Foreclosing on a property means you are
exercising your right to acquire the
property that you are entitled to. These
rights include the right of ownership free
and clear and the right to live in or lease
the property.
Foreclosing on a tax lien does not happen
often, but it does happen, and it is one of
the extraordinary bonuses of buying tax
lien certificates. No other legitimate,
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safe investment strategy allows you the
opportunity to get valuable real estate at
rock bottom prices. Can you imagine paying
$10,000 in tax lien certificates and
getting a $200,000 property in return? This
is not a common occurrence, but if you are
one of the wise investors who faithfully
purchase tax liens, you could be one of the
lucky ones.
Foreclosure Procedures
Although a tax lien foreclosure is a
lucrative deal, it is not a simple process.
First, every state has its own particular
requirements and procedures on tax lien
foreclosure. Second, the laws in every
state are very strict about procedures. Any
failure to follow the required process may
stop you from getting a deed to the
property, or may make any deed you do get
void. This is the time to be precise.
Because you need to be careful when
foreclosing on a tax lien, it is definitely
time to get a lawyer. There is a lot at
stake here and the costs of a lawyer are
easily justified. If you get the property,
you’ll be getting it for pennies on the
dollar. And if the delinquent property
owner finally pays up during the process,
which he is entitled to do under law, he
will typically have to pay your attorney’s
fees.
Besides, in some states you will be
required to court where you will have to
file legal documents and present evidence.
These are not easy jobs to accomplish if
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you are not a lawyer and a judge is
unlikely to cut you any slack. And keep in
mind any mistakes may result in your case
being thrown out. Spend the money on a
lawyer.
Although the basic procedures for
foreclosing are different from state to
state, here are a list of general facts and
practices that are common in tax lien
foreclosure:
• The Notification of Foreclose
All states require that before you
foreclose on property, you must give
notice to those interested in the
property. This is not a state law – it
is considered “due process” under the
United States Federal Constitution.
This means that:
► You will need to notify the owners of
the property as recorded on the current
tax roll. The treasurer of the county in
which the property is located should
have the current tax roll for you.
► You may need to notify the people
actually living on the property, like
tenants. And you may have to notify any
heirs of the property owners.
► You may need to notify any and all
lien holders. This would include other
holders of tax lien certificates on the
property. Keep in mind that you will
have to pay off other tax liens before
foreclosing.
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► You may need to notify the mortgage
holders of the property. Keep in mind
that once the mortgage company receives
your notice, they may pay off your tax
lien to avoid foreclosure. This is
because if the property is foreclosed on
and you get the title to it, the
mortgage company loses their money.
• A notification of foreclosure describes
the location of the property, its legal
description, the property’s tax parcel
identification number, and the
certificate of purchase number. The
notice must also state when the
foreclosure proceedings are to be held.
► The notice of foreclosure most often
has to be personally delivered via a
process server to the property owner. It
may also be sent via certified or
registered mail.
► The notice of foreclosure sometimes
has to be published in a specified
newspaper. It may also have to be posted
on the property and/or public places, or
even at the local county court house.
• Going to Court
Some states require you to go to court
to foreclose on a tax lien and others do
not. In general, it is best to go to
court in order to get a court judgment
that says the property is yours.
It also wise to bring what’s called a
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“Quiet Title” action, which is a
proceeding in court asking that you be
declared the true owner of the property.
This will protect you if the previous
owner ever tries to appeal.
• What You Can Expect In Court
During the court proceedings on the
foreclosure, the judge will determine if
you followed the state’s foreclosure
laws in a proper and timely fashion.
That is why you want an attorney to
represent you in court. If everything
has been done correctly, in some states
the judge will order the county’s
treasurer or some other official to
issue you a deed to the property.
Once the court proceedings are finished
and you are successful, you become the
proud new owner of a piece of property
that is worth much more than what you
paid for it.
In the world of tax lien investing,
gaining property through foreclosure is
comparable to winning the lottery
because you own a property that is worth
10 to 50 times more than your initial
investment in the tax lien certificate.
Imagine acquiring a piece of real estate
that is worth $50,000 and you only had
to pay a fraction of that value to get
it.
• What To Do With Foreclosed Property
Now that you own this valuable piece of
property what do you do with it? You can
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either rent it out to tenants or sell
it.
If you decide to lease the property to
tenants, you will have a steady flow of
income for as long as you own the
property. However, you will have to deal
with such things as: making repairs to
the property and finding tenants to live
in it; you will have to pay property
taxes and insurance premiums; you will
have to pay income tax on the rent you
receive; and, you will have to deal with
tenants who don’t pay their rent.
By selling the property immediately, all
of the money from the proceeds of the
sale go directly to you. So, if you sell
the property for, say, $20,000, all of
that money flows into your bank account.
That’s not to say that Uncle Sam won’t
take his cut also. You see, you will
have to pay tax on your gain when you
sell the property. The gain is the
difference between what you sell the
property for and the cost of the tax
lien. Because your gain will be
considerable, so will you tax burden. If
you decide to sell your property, keep
in mind you will have to pay taxes of
30% or more on the cash you make on the
sale.
Selling a property which you gain
through foreclosure of a tax lien is
similar to selling property that you get
any other way, but these are some issues
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you will need to consider:
► Get liability and fire insurance on
the new property. Now that you are the
owner of this property, you will need to
protect your investment, especially
since you don’t really know what
condition it’s in.
► As mentioned previously, it is smart
to bring what’s called a “Quiet Title”
action, which is a proceeding in court
asking that you be declared the true
owner of the property. This court
judgment will help protect you against
any later legal challenges to your title
by, for example, by the former owner.
The person buying your property will
also want to see that you’ve
accomplished this procedure (and the
title company). That way, the buyer will
feel assured he/she will not face a
potential lawsuit by the former owner.
► Do not price your property too high
when you sell it. The lower you set the
price, the faster it will sell. After
all, you already own a lot of equity in
your property so don’t be too greedy.
► Finally, pay the property taxes you
owe on your new property, even if you
decide to sell it. Just because you
acquired your property through tax lien
foreclosure doesn’t mean it can’t happen
to you – it can, so pay your taxes.
Although the tax lien foreclosure
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process sounds complicated, it really
isn’t as long as you find out the
specific laws and procedures of
foreclosure in the state where you hold
the tax lien certificate. Getting the
right information is imperative.
Otherwise, if you do not follow the
rules, the property owner could appeal
the court decision. This means that you
might lose the property. Again, you
would be wise to hire legal
representation.
Section #3: Colorado – An Example Of A State That
Sells Tax Lien Certificates
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Section #3: Colorado - An Example Of A State
That Sells Tax Lien Certificates
In the previous section, Section #2, “How To
Buy Tax Lien Certificates”, you learned the
general rules and procedures of states that
sell tax lien certificates, including how to
buy property tax liens, the information you
need to get started, and the tools you need to
be successful in your tax lien investment
strategy.
In this section of the report, the focus is on
the specific tax lien procedures of Colorado,
which is a state that not only sells property
tax liens, but also one where tax lien
investing is particularly profitable. This
section is intended to zero in on a state that
sells tax liens and show you how they do it and
what their specific requirements are.
Here is a breakdown of the various Colorado tax
lien sale procedures. Individual Colorado
counties may differ in their exact procedures
but this list presents a summary:
1. Colorado: Before the Tax Sale Takes Place
• The list of tax liens for sale are
advertised three to four weekly issues
of local Colorado newspapers in October.
• The list advertises the properties for
sale, their locations, a brief
description, and the amount of taxes
owed. This list is also posted in the
treasurer’s office of your county. You
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can usually pick up a copy as soon as it
is published. Some counties even post
their tax list on their website. Tax
lists are also always available on the
day of the sale.
If you live out of town, many county
treasurer offices will mail the list to
you for a few dollars, as well as a copy
of their tax sale procedures.
2. Colorado: Tax Sale Procedures
• The date of each county tax sale is
different for each county, although all
take place between October to mid-
December of any given year. Check with
individual counties to find out when
they hold their tax sales.
• Each county tax sale takes place in a
county building, like the County
Courthouse or the County Treasurer’s
Office. Check with individual counties
to find out where they hold their tax
sales.
• If you plan on paying by personal check,
you must go to the county treasurer’s
office where the sale is taking place
and provide a letter of credit from the
bank on which the check is drawn, which
guarantees that the check is good up to
a certain amount. You must do this prior
to the sale day. If this procedure seems
like a hassle, plan on bringing a lot of
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cash, depending on how much you want to
spend, or a certified check.
• Registration
► In some counties, registration usually
begins an hour or two before the sale
starts, which takes place early to mid-
morning on a weekday, usually on Monday.
However, some counties allow, and
strongly encourage, pre-registration
prior to the actual sale date. They also
allow registration by mail. Check each
county for information regarding
registration.
► No change in the registrant’s name can
be made so don’t have a friend who is
also participating in the sale sign in
early for you.
► At registration, each bidder (or
buyer) is required to complete a buyer
registration form, as well as an IRS
Form W-9 with their name, address, and
social security number or federal tax
identification number. After the forms
have been completed, you will be
assigned your own bidder number and
given a bidder’s card.
• Deposits
► Some counties also require a proof of
deposit at registration in the form of
cash, certified check, or personal check
(which, as mentioned above, must be
guaranteed by your banks irrevocable
letter of credit).
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► You must have the funds on deposit in
the amount you wish to invest. If you
have not spent the entire amount you
deposited during registration, you will
receive a check from the county the week
following the tax lien sale.
► You can also make additional deposits
anytime throughout the sale. Deposits
must be made in the name of the person
buying the tax lien certificate and no
transfer of deposits from one account to
another is allowed.
• All seating is on a first come, first
served basis so it’s best to get there
as early as possible.
• You must be present at the tax lien sale
to bid. You cannot have someone do it
for you. If you live out of town, this
means you will have to travel to the
county. For this reason, it’s best to
buy tax liens in states that are in
close proximity of where you live.
3. Colorado: The Day of the Tax Sale
• The sale begins early and lasts until
5:00 pm at the latest. If all tax liens
have not been sold, the sale is
continued the next day.
• You must be present and registered to
participate in the bidding process.
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• Each tax lien is auctioned off in order
(or in close order) of the published
list of the tax liens for sale that the
county provides prior to the day of the
auction
• During the auction, the tax liens for
sale are generally divided into four
groups:
1.) Liens that are $100 or less.
2.) Liens that are between $100 and
$2,000.
3.) Liens that are more than $2,000.
4.) Liens with alert information. The
alert information is a good faith
effort to share known information
with prospective tax lien sale
buyers. These liens are offered for
open bidding.
• Each bidder is given a paddle with a
number on it. Bidding is on an open and
competitive basis. When the taxes you
wish to purchase are auctioned, you
raise your paddle.
4. Colorado: Premium Bids
Unlike most states in which you bid on the
amount of interest you are going to
require the property owner to pay you,
Colorado is structured as a premium bid. A
premium bid is an amount over and above
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the starting auction price (the amount of
the unpaid taxes plus interest). Each
successful bidder agrees to pay the
delinquent or unpaid tax amount and the
amount of their premium bid, which is
essentially extra money.
It’s important to keep in mind that the
premium or extra money you pay for a tax
lien certificate is non-refundable, which
means you will not be paid back for the
premium once the tax lien is paid off by
the property owner.
Here are some general procedures on premium
bidding:
• The auctioneer starts the bidding
process for the premium amount only (a
premium, as explained in the section on
premium bids, is the amount over the tax
due). The bidder offering the highest
premium will successfully purchase the
tax lien. Again, this premium bid will
not be refunded to you once the taxes
are paid by the delinquent property
owner.
• Premium bids are in increments or raises
of $1.00, $5.00, $10.00, and up,
depending on the value of the tax lien.
Premium bids range from zero to 10% of
the value of the amount of the tax lien
up for sale.
• Some counties do not allow premium bids
below a certain tax lien amount. For
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example, Larimer County only accepts
premium bids on properties with a unpaid
tax amount of $5,000 or more.
• Once you’ve bought all the tax liens you
want to purchase, you may leave at any
time.
• All successful bids are final. No
changes in bids or cancellation of bids
are allowed. Unless you do not have the
funds to cover the purchase, the sale
cannot be reversed.
5. Colorado: Purchasing Tax Lien Certificates
• Purchases of tax liens must be paid
before leaving the auction premises.
Failure to do so will result in the loss
of your lien purchase.
• A tax lien certificate is issued for
each lien to the successful bidder. It
will list the property description,
purchase amount, rate of interest, the
buyer’s name, and the date of sale.
• Certificates will only be issued in the
name of the buyer.
• Tax lien certificates are either given
to you upon purchase, which you must
keep for your records, or they are held
by the treasurer’s office of the county
from which it was purchased. If you get
to keep your tax lien certificate, do
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not lose it as you will need it once it
is redeemed.
• If you decide you want to transfer your
tax lien certificate to someone else
before it is paid by the property owner,
most counties allow you to do this. But
when you sign away your rights to it,
you are also relinquishing your share of
the interest earned on it.
• Interest on your tax lien certificate
begins to grow from the month the
certificate is issued. The interest
earned is calculated on a monthly basis
based on the rate and the number of
months you hold the tax lien certificate
before it is paid. For example, a tax
certificate worth $2,000 at a 12%
interest rate (the rate established for
2001) would be:
Rate of interest earned annually:
12% ÷ 12 months = 1% per month
Total interest earned on the lien:
1% x 14 months = 14%
14% x $2,000 = $280
You would earn $280 on your tax lien
certificate.
• The amount of interest you earn on your
tax lien certificates depends on the
amount of the certificate, how long you
have it before it is paid, and what the
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current year’s interest rate is (in
Colorado, tax lien interest rates change
yearly).
• The interest you earn is simple
interest. It is not compounded.
6. Colorado: Endorsing Subsequent Years Taxes
Each year following the purchase of your
original certificate, if the property
owner has not paid their current year
taxes by the due date, you have the option
of paying (or endorsing) the subsequent
year’s unpaid taxes and adding them to
your original certificate without having
to attend another tax sale auction. This
procedure is called sub-taxing.
You are not required to pay any additional
taxes by endorsement, but you cannot bid
on them at another tax sale.
• In July of any given year, the
Treasurer’s Office will send you a
notice listing what certificates you can
endorse and the amount of each
endorsement.
• You do not have to pay a premium on
endorsements, just the amount of the
unpaid taxes, plus interest.
• The interest rate on endorsements is the
same as the interest rate on your
original tax lien sale certificate and
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remains the same for the life of the
lien.
7. Colorado: Redeeming Tax Lien Certificates
• The redemption period (or the amount of
time the property owner has to pay you
for the tax lien) is 3 years from the
year of the original sale.
• When taxes are redeemed, you will either
receive a check or notification that
your tax lien certificate has been
redeemed.
• Property owners do not contact you
directly to pay off the tax lien. They
must do this at the county treasurer’s
office.
• The delinquent property owner can pay
off your tax lien certificate at any
time before and after the sale. If the
property owner pays the tax lien before
the sale, his name is crossed off the
county’s list of liens for sale. If the
property owner, pays after the sale, you
will earn the interest on the number of
months you’ve held the tax lien
certificate.
• If the certificate of purchase is in
your possession, you will need to return
it to the county treasurer’s office.
Upon receipt of the certificate, you
will receive a check, which will include
the amount of the tax you purchased,
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plus the interest that has accumulated
from the day of the sale to the date of
redemption. Again, you are not refunded
for any premium amount you paid at the
auction.
• If the county treasurer’s office has
your tax lien certificate, you don’t
have to do anything at all – they send
you a check in the mail. Make sure your
correct address is on file at the
treasurer’s office.
• Interest is only paid to the tax lien
certificate holder when the lien is
redeemed by the delinquent property
owner. You cannot collect your interest
early.
8. Colorado: Getting a Treasurer’s Deed
Once three years have passed and the
property owner still has not redeemed (or
paid) your tax lien certificate, you are
entitled to apply for what is called a
Treasurer’s Deed, which is the final step
in the tax lien process.
You must apply for a Treasurer’s Deed with
the county treasurer’s office that issued
you the tax lien certificate. In some
counties, deed applications may be made 6
months before the 3-year redemption
period. Applications may be made by mail,
phone, or fax.
Here are more procedures involved in
getting a Treasurer’s Deed in Colorado:
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• Along with your application, you will
have to pay a deposit, as well as
additional processing fees required by
the county. Don’t worry, if the property
owner redeems the tax lien during your
application for a deed, the county will
refund you all of your deed application
fees (but you will not earn interest on
this money).
• Once an application is made to the
Treasurer’s office, you must advertise
and post public notice on the property
itself. You must also notify anyone with
a legal interest in the property (i.e.
the property owner,
• Before you receive the deed, all
subsequent taxes and current taxes must
be paid. Again, all these fees will be
refunded if the property owner redeems
the tax lien during your application for
the deed.
• The application processing time takes
five to 9 months. The property owner can
redeem the lien at any time during the
application process.
• Finally, if you are issued a Treasurer’s
Deed to the property for which you hold
a tax lien certificate, you will then
have to go to court to bring a “quiet
title action”, which is a legal
proceeding asking that you be declared
the true owner of the property.
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Even if Colorado is not one of the states
where you want to invest in tax liens, the
outlined procedures above should give you
an idea of how a “tax lien type state”,
like Colorado, conducts the various
aspects of their tax lien procedures, like
auctions, bidding, certificate purchases,
redemption, foreclosure, etc. It is worth
noting again that tax lien type states all
differ in their exact procedures, so be
sure you find out what these procedures are
before you invest in tax liens. For more
information on tax lien type states, please
refer to Section #7, “States Where Tax Lien
Investing Is Most Profitable” on page 78.
Section #4: Useful Tips on Buying Tax Lien
Certificates at Tax Sales
Page 49 of 89
Section #4: Useful Tips on Buying Tax Lien
Certificates at Tax Sales
Now that you know the procedures involved in
buying property tax liens, it’s time to
formulate a strategy.
The first step in your tax lien investment
strategy is to do some research before you
start investing. These steps include:
1. Review the list of states that sell tax
lien certificates on properties.
2. Choose a county to invest in property
tax liens.
3. Call the county treasurer’s office for
tax lien sale information.
4. Get a copy of the list of available tax
liens for sale.
5. Research the properties.
6. Check the county’s assessment of the
properties.
• Review the list of states that sell tax
lien certificates on properties.
On page 78 of this report in Section #7,
”States Where Tax Lien Investing Is Most
Profitable”, you will find a complete
list of the states that sell tax lien
certificates on properties.
Section #4: Useful Tips on Buying Tax Lien
Certificates at Tax Sales
Page 50 of 89
There currently over 30 states that sell
tax lien certificates. The states not on
the list sell delinquent properties at
auction.
Of the roughly 30 states that sell tax
lien certificates, approximately 15
offer exceptionally high rate of return.
If you go to page 78, you will find a
list of states that pay 15% or more on
their tax lien certificates. These are
the states you should focus on.
► Determine what interest rate you want.
The rates offered vary from state to
state. They can also vary from year to
year. For example, Michigan offers 15%
the first year and 50% the second year.
► If your goal is just to get a high
rate of return on your tax lien
investment, you might want to consider
investing in states with a strong
economy. The odds are you have a better
chance of getting paid back for the tax
lien you hold. If the state has a low
unemployment rate and depreciating real
estate values, this is not a good state
to invest in.
► Invest in tax liens close to home.
If you live in a state that sells tax
lien certificates, you’re in luck.
Buying property tax liens in the state
you live in is the first place you
should invest.
You see, many state counties require you
to be present to bid on their tax liens
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Certificates at Tax Sales
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so it is far more convenient to drive to
an auction in a state (and county)
close to your home.
Also, it always wise to personally
inspect the properties you’re interested
in because you might end up owning these
properties one day and you want to make
sure they have some value. If you live
close by, you won’t have to drive hours
out of your way to see these properties
for yourself.
If you don’t live near the county where
the property is located, you can always
ask the county treasurer’s office for
advice (but they are typically too busy
to offer help)or you might try calling a
real estate broker in the area.
• Once You’ve Narrowed Down A Particular
State, Choose a County To Invest in Tax
Liens
Because state counties are the ones who
that hold tax auctions (where tax lien
certificates are sold), you will have to
choose one or more counties to begin
your investing. These are a few key
points to be aware of when selecting an
appropriate county:
► Select rural counties
Consider picking tax liens in rural
counties. Why? The competition is often
next to none with bargains galore. Plus,
the staff at the county treasurer’s
office has far more time to answer your
questions and give you advice. In a
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small rural county, the staff usually
knows everything there is to know about
the properties and will share with you
what they know.
► If you decide not to pick rural
counties, find counties that have a
friendly, helpful staff.
► Select nice neighborhoods
Within every county, there is a “good
area” and a less desirable one. You want
your tax lien certificate to be on
property in a desirable area. Talk to
the staff at the county treasurer’s to
find out which areas are nicest.
► Find a county that meets your needs.
For example, if you want to purchase tax
lien certificates in another state but
do not want to travel to the tax
auction, find a county that will allow
you to bid through the mail or purchase
tax liens over the counter or online.
That way, you will not have to take on
the inconvenience or expense of
traveling.
►Choose a county that has accessible
resources and forms. Many counties now
provide their tax sale information and
forms online, which is probably the most
convenient way for you to access them,
especially if you live out of state.
• Call the County Treasurer’s Office For
Tax Sale Information
As soon as you have determined the state
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and the county you want to buy in, you
should contact the county administration
department that handles property tax
liens (usually the county treasurer’s
office) to find out the date, time, and
place of the next tax auction. Each
state is different in when and how often
they hold their auctions. Some states
hold auctions once a year, like
Colorado, while other states hold their
auctions 4 times a year or even monthly.
Here are a list of questions to ask a
county treasurer’s office:
1.) What is the date and time of your
next tax auction (or tax sale)?
2.) Are auctions held more than once a
year? If so, what are the dates
and times of the other auctions
scheduled for the year?
3.) What is the location of the
auction?
4.) Do I have to be physically present
at the auction in order to bid?
5.) What are the registration
procedures? Is a deposit required?
Do I have to pre-register?
6.) What are your bidding rules?
7.) If I buy a tax lien certificate,
what is the method of payment?
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8.) Will I have to pay additional
costs, like county administrative
fees?
9.) What is current interest rates on
your tax lien certificates?
10.) What is the redemption period?
11.) What happens if the delinquent
taxpayer doesn’t redeem the tax
lien certificate I buy? What are
your foreclosure procedures?
12.) Can I purchase the leftover liens
from the county after the auction?
To find out what leftover liens
are, please go to page 66.
These may seem like a lot of questions
to ask, but keep in mind the county will
probably refer you to a page on their
website to get this information or else
they will send you something in the
mail.
However you get hold of the county’s tax
lien information, make sure you:
► Find out the county’s current interest
rate on their tax lien certificates
(which is the same for all the counties
in that state). It is smart to invest in
states that offer at least a 16%
interest rate on their tax lien
certificates, especially if your goal is
to get your money back for the tax lien
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certificate with a high rate of
interest.
► Find out the county’s redemption
period. Ideally, you should invest if
the redemption period is 3 years or
less.
► Find out the county’s bidding
procedures. In general there are four
types of bidding procedures:
1. Bidding on Interest Rates: In most
states what you are bidding on is
how much interest you are going to
require the delinquent owner to pay
you when he redeems your tax lien
certificate. So, for example, if the
state sets interest rates at 24%,
the opening bid would be 24% and
then go down from there.
2. Premium Bidding: With premium bids,
you pay the taxes, interest, and
penalties, plus an certain amount of
cash on top of that. What you bid on
is the amount of cash you are
willing to pay, which you will not
get back when the tax lien
certificate is redeemed. Colorado is
an example of a state that uses
premium bidding.
3. Dividing Ownership: Buyers bid on
the percentage of ownership in the
property for which the tax lien
certificate is held. Bidding starts
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at 100% and goes down from there.
So, if you successfully bid 80%
ownership on a property for which
you hold a tax lien certificate, in
the event the property forecloses
and you get the property, you will
have to share ownership with the
delinquent owner, who holds the
other 20%.
4. Bidding on the Property: With this
type of bidding, buyers compete on
the amount they are willing to pay
for the property in the event the
owner does not redeem the tax lien
certificate. At this type of
auction, all you have to pay is the
amount of the unpaid taxes.
• Get a Copy of the List of Available Tax
Liens For Sale
There are literally thousands of
property tax liens for sale by state
counties all over the country and in
order to start investing in them, you
need to find out where and when these
tax sales are taking place and what tax
liens are being sold. Before you go to
the tax auction, it is also important
that you get an accurate list of the tax
lien certificates for sale.
Each state’s law also requires the list
of properties be published in the local
newspaper prior to the day of the sale,
but you want to get the list well before
it is published in the newspaper.
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In order to do this, you need to call
the counties in the state (or states)
that you want to invest in and get this
information. Most counties that sell
property tax liens are more than happy
to provide you with information about
their tax sales, but the hard part is
figuring out who to call.
The best thing to do is to call the
county treasurer’s office (or county
courthouse) in the county where you want
to purchase tax lien certificates and
ask them how you can get a copy of the
list of the property tax liens being
sold at the auction. For a listing of
state counties, please visit the County
Phone List section on our website at:
http://taxliensalecertificate.com/countylist.htm.
Our County Phone Lists give you the
name, phone number, and address of every
single county in states where tax lien
investing is most profitable.
Once you contact the county treasurer’s
office, ask for a copy of the tax liens
for sale list (most county treasurers
will mail or fax you this information
or they will give you a link to their
website where the property tax liens for
sale are advertised). You can also ask
to be put on their mailing list so that
you will be notified about any upcoming
tax sales ahead of time.
• Research the properties
Once you have a list of available
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property tax liens in the county, you
must then research the properties (on
which the tax liens are held).
Researching properties is important
because if the tax lien is not redeemed
by the property owner, you will
eventually gain ownership to that
property. You don’t want to be stuck
with property that is worthless so be
sure the property you’re investing in is
of some market value.
A property has market value because
something can be done with it. For
example, don’t invest in tax liens on
properties that are located in desolate
mobile home parks or ghost towns. Also,
beware of investing in unbuildable
strips of land because there’s a good
chance it’s useless. The only value of
land lies in what you can do with it and
that is why you need to get a good
understanding of the properties before
you buy tax liens.
Researching the list of properties is
not an easy task. The list generally
includes some sort of description of the
property, their locations, and the
amount of the taxes owed, but what it
will look like are a bunch of numbers
that you probably won’t be able to
decipher. Here is an example:
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Parcel No. Titleholder Location Amount Due
460-17-95691 Mark & Section 14, $1,015.67
Karen Township
Wilson 25S, Range
29E
R 14 25 29
1368 1815
As you can see, the first column lists
the parcel number, the second column
lists the name of the individuals on the
title (or who is responsible for paying
the taxes). The third column lists the
location of the property and the fourth
column lists the amount due.
Now that you have the list, here’s what
you need to do:
► Think about how much you want to
invest. Looking at the list, determine
which tax liens are in your price range.
► Call the county treasurer’s office
again and ask for help in translating
the listings that you want to invest in.
These are some questions to ask:
1. What area of the county is this
property located in?
2. How is this property zoned
(commercial, residential, etc.)?
3. Are the properties above or below
the average home price?
4. Is this a good area to buy a tax
lien?
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County employees are generally very
helpful when it comes to providing
information to the public about tax lien
sales since county sales of tax liens
help to keep them in business. That is
why when you research properties with
tax liens always:
► Establish a Relationship With the
Staff at the county treasurer’s office.
The surest way to get tax lien
certificates on the best properties is
to get help from the staff at the county
treasurer’s office. They can steer you
to where the best properties are.
Some counties have entire towns where
you definitely would not want to own
property. Problem areas, or problems
with individual properties are known by
the local people, so be sure you make
friends with one, preferably at the
county treasurer’s office (or even the
county assessor’s office).
But, whatever you do, do not mention
foreclosure. Local officials don’t mind
helping you find tax liens to purchase,
which will benefit the county, but they
do not want to be in a position of
helping you foreclose on property in
their area.
Visiting the with the staff in person is
always best, but you can also call them
on the phone. Just be friendly and
polite at all times.
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Also, be sure to ask the staff which
areas in their county have the highest
rates of redemption and which have the
lowest (you want to buy properties in
areas with high rates of redemption).
Get as much information as you can from
the county employee you talk to. Whoever
you talk to should be very helpful in
identifying good areas from the bad.
Check the County’s Assessment of the
Properties
One of the great features of tax lien
certificates is that each property comes
with a free professional appraisal of
its market value by a government agency.
Look at these appraisal values closely.
Here are some facts to remember:
► County assessors evaluate property
according to “Land Value” and
“Improvements”. These two numbers added
together equal the total assessed value
of the property, which may or may not be
equivalent to market value.
For example, if the land = $8,000 and
the improvements = $36,972, the total of
these two number is $44,972.00, which is
the amount the property taxes are based
on.
If you have any questions at all about
the appraised value of the property
you’re interested in, call the county
assessor’s office for help.
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► Relate the appraised value of the
property to other properties in the
area.
Your goal in checking the county’s
appraisal of the property is to
determine whether its appraised value is
comparable to the appraised values of
other properties in the area. If the
appraised value is much lower than other
properties in the area, don’t think
you’ve found a great bargain – it’s more
than likely something is wrong with the
property. Do not deal with property that
has an appraised value that is
significantly low for its location.
► Check out the zoning of the property.
Call the county assessor’s office to
find out the zoning of the property.
There are 5 major types of property,
including residential, commercial,
industrial, agricultural, and special
purpose (which includes schools and
churches, government land, etc.).
To be on the safe side with tax lien
investing, it is smart to stick with
residential properties, which is
discussed in more detail on page 63.
When you call the county treasurer’s
office, ask them what the property has
been zoned for and make sure it is
residential.
► When talking to the county assessor’s
office, check to see if your property is
located in a designated floodplain or to
see if the property has any
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environmental problems. Needless to say,
steer clear of properties that flood or
one that is environmentally
contaminated.
► Finally, if you think you have found a
good tax lien to invest in, you might
want to verify the information with a
local real estate agent by asking him
for an estimated sales price for the
house.
General Tips
Now that you have your research in hand,
it’s time to start investing. Before you
attend a tax auction, read these useful
recommendations for getting the best
bargains and the biggest returns on tax
lien certificates.
• Stick with residential properties
As mentioned previously, buy tax liens
on residential properties as opposed to
commercial or industrial properties,
which can be hassle (and expensive).
Residential properties have a higher
rate of redemption and are less likely
to have environmental problems.
• Stick with improved properties
If you decide you want to diversify your
tax lien portfolio and try your hand at
investing in commercial properties as
well, incredible opportunities exist in
tax lien certificates on commercial
properties.
Just remember to stick with improved
properties, as opposed to raw land. In
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fact, if you decide to invest in
commercial property, do not invest in
raw land, which is a much more difficult
to evaluate and is almost always a bad
deal.
For the most part, a property has market
value because something can be done with
it. Improved property has proven that is
has some use. Raw land, on the other
hand, has not had any improvements done
to it and one of the reasons is because
the local government will not allow
improvements.
Whatever the case may be, raw land
requires a good deal more investigation
and may require the expertise of someone
in the know, like an architect or real
estate broker. You should avoid it in
your tax lien investment strategy.
• Bid on higher value properties
You should bid on higher value
properties because they tend to take
longer to be paid off. The larger the
dollar amount of the lien and the longer
you hold your lien, the more interest
you will make on your investment.
• Bid on higher value tax liens
If you have the money to invest, try
bidding on tax liens of values greater
than $2,000. This is because you will
earn more money in interest.
For example, compare a $5,000 tax lien
that is held for 20 months at 12% with a
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$1,000 lien that is held for 15 months
at the same interest rate:
Rate Of Interest on a $5,000 Tax lien
held for 20 months @ 12% interest
Rate of interest earned annually:
12% ÷ 12 months = 1%
Total interest earned on the lien:
1% x 20 months = 20%
20% x $5,000 = $1,000
You would earn $1,000 on your
$5,000 tax lien.
Now, let’s look at the rate of return
for the $1,000 lien:
Rate Of Interest on a $1,000 Tax lien
held for 20 months @ 12% interest
Rate of interest earned annually:
12% ÷ 12 months = 1%
Total interest earned on the lien:
1% x 15 months = 15%
15% x $1,000 = $150
You would earn $150 on your $1,000
tax lien.
Like a bank CD, the more money you put
in and the longer you keep invested, the
more money you will make in interest. If
you have the cash to spend on a tax
lien, go for the lien values greater
than $2,000.
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• Purchase a wide variety of properties.
Don’t put all of your eggs in one
basket. If you bring $5,000 to a tax
lien auction, don’t blow it all on one
property. The investment risk should be
spread over a number of properties in
the event the lien is paid off early by
the property owner, in which case you
might lose money.
• Do not purchase liens on vacant land
because these are too easily redeemed.
You don’t want a property owner to pay
off your tax lien certificate right away
because you will earn less interest and,
you could even lose money if the
interest you earn doesn’t reimburse you
for the premium you had to pay to buy
the lien.
You want your tax lien to earn enough
money to where you cover the premium on
the certificate and earn some interest.
• Purchase leftover liens
Even if you miss a county’s tax auction,
many state counties offer leftover liens
not sold at auction to prospective
buyers.
What are leftover liens? They are simply
liens that did not sell at the tax
auction. In fact, so many leftover liens
do not sell at county tax auctions that
billions of dollars in available tax
liens exist in more than 1,300 counties
in 27 states.
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Typically, there are far more tax liens,
available for sale than there are
investors to buy them so counties are
left with a surplus. These liens are
available to anyone, but the only major
drawback in buying directly from the
county treasurer’s office is that the
selection is less, and the properties
tend to be of minimal value. So, if you
hope to someday own the property for
which you hold a leftover lien
certificate, you are advised to go to
the property and see it for yourself
before making a decision.
Although leftover liens, or “county held
certificates”, as they’re often called,
tend to be on property of little value,
they are still a good investment because
you get the same benefits as a regular
tax lien, which means a guaranteed rate
of return on the money you paid to
purchase it. But, unlike regular tax
liens, you do not have to bid against
anybody and you get to keep the maximum
interest that the state allows(or, in
the case of Colorado, you don’t have to
pay a premium bid).
If a state county does offer leftover
liens, they will have a list of them in
the treasurer’s office. Some counties
also make this information available on
their websites.
How To Purchase Leftover Liens
The process of purchasing leftover liens
is very simple. In many cases, you do
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not have to buy these liens in person –
you can purchase them by mail. Some
states even allow you to buy them online
from their website.
If you do buy leftover liens, here are
some pointers:
► Check with the county to make sure
they offer leftover liens because not
all do. Also, make sure the county
allows for direct purchases after the
auction (which means you can buy
leftover liens directly from the county
without having to bid at an auction).
Some states, like Iowa, provide that if
any leftovers exist, they will be
auctioned off at another time.
► Your chances of finding good deals on
good properties is greater in rural
counties, where the auctions draw far
less people. This means that rural
counties are not only more likely to
have more leftovers, but these leftovers
are also more likely to be of some
value. Big cities, on the other hand,
have less of a selection and the
properties are often not worth investing
in.
► Buy early in the year because with a
leftover lien, you will have to pay the
county treasurer whatever interest and
penalties have accumulated up to that
time (more penalties and interest will
have been added on later in the year).
► Find out from the staff at the county
treasurer’s office which leftover liens
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are winners and which ones are duds.
Remember, if the tax lien is not
redeemed by the property owner, you do
not want to be stuck with worthless
property.
► Leftover liens are a good investment
For those investors who do not want to
go to the trouble of attending county
tax auctions in person, which is a
requirement in most counties to bid and
purchase tax lien certificates, leftover
liens are the answer.
Although chances are you will not walk
away with a valuable piece of property,
you will make a guaranteed, high rate of
return on your investment once the
property owner redeems the lien.
What’s even more appealing about
leftover liens is that the interest rate
will be the highest possible and you
generally do not have to physically go
to the county treasurer’s office to buy
your lien – you can buy your lien via
mail, which is the ideal arrangement for
out-of-state investors.
Section #5: The Risks Involved In Tax Lien
Investing
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Section #5: The Risks Involved in Tax Lien
Investing
Most safe investments with high rates of return
involve an element of risk and the same is true
with property tax liens.
For example, if you’ve ever invested your money
in the stock market, you know how risky that
can be. With stock market investing, your money
is often here today and gone tomorrow. Not only
is your rate of return unreliable, but you can
even lose all of the hard-earned money you
started with. Yet millions of Americans invest
in the stock market every day without a second
thought.
Unlike the stock market, tax liens are not
risky. They are guaranteed by the government to
provide high rates of returns to their
investors. In fact, they are far safer than
investing in the stock market. Nevertheless,
here are the risks involved in tax lien
investing:
• Bankruptcy
One of the risks you assume when you buy
a tax lien certificate is that the
property owner may declare bankruptcy.
This doesn’t mean you won't get paid back
for your tax lien certificate, plus the
interest you’re owed. You will, it just
may take a little longer.
You see, tax liens are a “first, prior,
perpetual lien against the property”.
This means taxes take priority over
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mortgages, other legal judgments, and
other liens. Also, tax liens cannot be
erased from legal record until they are
paid in full with penalties, interest,
and all. This is great news for the tax
lien investor because it means you can
feel confident knowing you will get your
money back, plus interest.
Nevertheless, bankruptcy filings by
property owners could delay the payment
of tax lien certificates. However, tax
sales liens are rarely denied by
bankruptcy courts and are almost always
paid.
When the delinquent property owner files
bankruptcy, the county treasurer will
notify you. If you get a notice of
bankruptcy, be aware that you may need
to file a claim. The best thing to do is
to call the county treasurer’s office to
find out what their bankruptcy
procedures are for tax lien holders.
Whatever you do, don’t let the threat of
bankruptcy deter you from investing in
tax liens because it does not happen
very often and, if it does, the tax lien
investor is first in line to get paid
back.
• Environmental problems
Another risk involved in tax lien
investing is that properties that have
tax liens can be determined by the
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federal government’s Environmental
Protection Agency (EPA) to be
environmentally contaminated (with, for
example, high levels of pesticides or
other hazardous chemicals).
In order to avoid this considerable
risk, you should only invest in
residential properties, which are very
unlikely to be tainted with hazardous
substances. In fact, the possibility of
residential property being contaminated
is so rare that almost no buyers, real
estate agents, or even lenders, pay much
attention to it.
For those of you who intend to follow
our recommendation to “stick with
residential properties”, environmental
problems are not even an issue. It’s if
you decide to invest in tax liens on
industrial, or even commercial,
properties that it becomes an important
consideration.
Properties that are zoned for commercial
or industrial use are much larger risk
and will require extensive research to
make sure they are not environmentally
contaminated(please refer to page 57
for more information on researching
properties).
Getting stuck with a property that has
environmental problems is serious
business and could cost you everything
you own so you would be smart to consult
the proper professionals for guidance
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Investing
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when dealing with commercial or
industrial properties.
• Consumer Fraud
As with so many other legitimate
investment opportunities that provide
high rates of return, tax liens are prey
to con artists looking to make a quick
buck on unsuspecting investors. When
researching tax lien certificates,
beware of consumer fraud.
Read these helpful tips and don’t become
a victim:
► Beware of local buying services that
offer to research and purchase your tax
lien certificates for you. One of the
great benefits of tax lien investing is
that you can buy tax lien certificates
yourself directly from the government at
no additional cost.
You don’t, for example, have to pay a
stockbroker to buy shares of stock in
the market; you can simply go to a tax
auction and buy a tax certificate
yourself so why pay someone else to do
something you can yourself at no cost?
► Beware of pyramid schemes that charge
you an entry fee and processing fees to
buy tax lien certificates.
► Do not join any tax lien investment
clubs, investment groups, etc. Typically
these groups try to pass themselves off
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Investing
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as legitimate when they’re really just
an illegal pyramid or multi-level
marketing scheme in sheep’s clothing.
► Never purchase tax lien certificates
or let a representative purchase tax
lien certificates for you on properties
that you know nothing about. Remember,
getting information on the properties
you’re about to invest in is important
because if the tax lien is not redeemed
by the property owner, you will
eventually gain ownership to that
property. You don’t want to be stuck
with property that is worthless so be
sure the property you’re investing in is
of some market value. For this reason,
do not invest in properties blindly –
research them yourself to make
absolutely sure they are worth investing
in.
These are only some of the types of tax
lien consumer fraud that are common.
When you begin your tax lien investing
and are tempted by a “get rich quick”
scheme, if it’s too good to be true, it
probably is. But, if you’re in doubt,
contact the National Fraud Information
Center at 1-800-876-7060 or visit their
website at http://www.fraud.org.
Section #6: List Of States That Sell Tax Lien
Certificates
Page 75 of 89
Section #6: List Of States That Sell Tax Lien
Certificates
Remember, not all states sell property tax
liens. Some states, like California, are
considered a “tax deed” states (as opposed to a
“tax lien” state) because they sell delinquent
properties at auction.
For example, in California if an owner does not
pay property taxes, the property becomes tax
defaulted and the owner has five years to
redeem the property. If the owner redeems, he
must pay interest, penalties, and costs to the
tax collector. If the owner does not redeem,
the county treasurer’s office does not place a
lien on the property (as a tax lien state
would); instead, they sell the property at
auction. A buyer who bids on the property at
auction will not be paid any interest (as he
would be on a lien); he is bidding on the
property and that is all he would get.
Unlike tax deed states, tax lien states, which
are the focus of this report, let you earn a
high rate of interest on the tax lien
certificate you own and collect the property
for pennies on the dollar if the owner fails to
redeem.
Here is a complete list of states in the
continental U.S. that sell property tax liens,
as well as interest rates and redemption
periods for each state. The interest rates and
redemption periods are subject to change.
Please call each state for verification. The
states are listed in alphabetical order:
Section #6: List Of States That Sell Tax Lien
Certificates
Page 76 of 89
List of Tax Lien States
State Interest Rate Redemption Period
Alabama 12% 3 years
Arizona 16% 3 years
Colorado Varies (9 percentage points 3 years
above the federal discount rate;
interest rates range between
11% to 15%
Florida 18% 2 years
Georgia 20% to 40% (20% first year, no 1 year
matter when redeemed, 40%
second year.)
Illinois 18% (18% for regular sale; 6 months, 2 years, 2.5
leftover liens-48%+) years
Indiana 10% to 25% (1-6 months - 1 year
10%; 6 months-1 year - 15%;
after 1 year - 25%; 10% on
surplus bid; 12% on
subsequent taxes and
assessments)
Iowa 24% 21 months
Kentucky 12% none
Louisiana 17% 3 years
Maryland Varies depending on county 2 to 6 months
(ex. 24% Baltimore City
County, 20% Montgomery
County)
Massachusetts 6.5%? 6 months
Michigan 15% - 50% (15% first year, 50% flat 12 to 18 months
fee for second year)
Section #6: List Of States That Sell Tax Lien
Certificates
Page 77 of 89
List of Tax Lien States
State Interest Rate Redemption Period
Mississippi 18% 2 years
Missouri 10% 2 years
Nebraska 14% 3 years
New Hampshire 18% 2 years
New Jersey 18% + 2% - 6% 2 years
New York (only in 10% 2 years
some counties)
North Dakota 12% 3 years
Oklahoma 8% 2 years
Rhode Island 16% (10% flat fee 1-6 months; 1 year
1% for each succeeding month)
South Carolina 8% 1 year
South Dakota 12% 4 years
Vermont 6% to 12% 1 year
West Virginia 12% 18 months
Wyoming 18% (15% interest first year, 4 years
plus flat fee of 3%, no matter
when redeemed)
Section #7: States Where Tax Lien Investing Is
Most Profitable
Page 78 of 89
Section #7: States Where Tax Lien Investing Is
Most Profitable
The previous section listed all the states in
the continental U.S. that sell tax lien
certificates. Of the approximately 27 states on
that list, not all of them pay a high rate of
return on their tax lien certificates.
It’s best to focus on states where your
investment will bring you a high rate of
interest with a high level of security.
Remember, each state (and each county within
the state) can differ on their exact tax lien
procedures, so be sure to find out. The variety
of state laws governing tax lien procedures
ensures you that there is a state whose system
will fit your needs.
Here is the list of states where tax lien
investing is most profitable:
For more information on the different types of
bidding systems, please see page 55.
List of the Most Profitable Tax Lien States
State Interest Rate Redemption Bidding System
Period
Arizona 16% 3 years Bidding On Interest
Rates:The successful bidder
is the one willing to accept
the lowest amount of
percentage upon the amount
so paid, in order to redeem
the property from the sale,
which shall not exceed the
rate of 16% per year simple.
Section #7: States Where Tax Lien Investing Is
Most Profitable
Page 79 of 89
List of the Most Profitable Tax Lien States
State Interest Rate Redemption Bidding System
Period
Colorado Varies (9 3 years Premium Bidding: Bidder
percentage points willing to pay the largest
above the federal amount of cash [called a
discount rate; premium bid] over the
interest rates amount of the tax lien.
range between Premium bid is not
11% to 15% refundable and does not
earn interest.
Florida 18% 2 years Bidding On Interest Rates:
Winning bid goes to the
person who will accept the
least rate of interest on the
amount of tax due. Bidding
starts at 18% and goes
down from there.
Georgia 20% to 40% (20% 1 year Bidding On Property:
first year, no Property is sold to the
matter when highest bidder; excess goes
redeemed, 40% to tax sale surplus fund. If
second year.) redeemed, tax purchaser to
receive excess money
back, if not redeemed,
excess goes to county
general fund.
Illinois 18% (18% for 6 months, 2 years, Bidding On Interest Rates:
regular sale; 2.5 years Winning bid goes to the
leftover liens- person who will accept the
48%+) least rate of interest on the
tax lien to be paid by the
property owner. Bidding
starts at 18% and goes
down from there.
Section #7: States Where Tax Lien Investing Is
Most Profitable
Page 80 of 89
List of the Most Profitable Tax Lien States
State Interest Rate Redemption Bidding System
Period
Indiana 10% to 25% (1-6 1 year Bidding On Property:
months - 10%; 6 Property is sold to the
months-1 year - highest bidder; excess goes
15%; after 1 year - to tax sale surplus fund. If
25%; 10% on redeemed, tax purchaser to
surplus bid; 12% receive excess money
on subsequent back, if not redeemed,
taxes and excess goes to county
assessments) general fund.
Iowa 24% 21 months Dividing Ownership:
Winning bid is the person
who pays the total amount
due, which is a lien on the
property, for the smallest
percentage of the property.
If the property is foreclosed,
and the purchaser agreed
to take less than a 100%
interest in the property, he
becomes the co-owner with
the delinquent taxpayer.
Louisiana 17% (12% flat fee 3 years Dividing Ownership:
+ 5% penalty, no Winning bid goes to the
matter when person willing to pay the
redeemed) total amount due, which is a
lien on the property, for the
smallest percentage of the
property. Louisiana has a
5% mandatory penalty, no
matter when redeemed.
Section #7: States Where Tax Lien Investing Is
Most Profitable
Page 81 of 89
List of the Most Profitable Tax Lien States
State Interest Rate Redemption Bidding System
Period
Maryland Varies depending 2 to 6 months Bidding On Property:
on county (Ex. Property sold at auction for
24% Baltimore the least amount of taxes,
City County, 20% interest, penalties and
Montgomery expenses. Buyer must pay
County) taxes due at auction and
then must pay the rest
during foreclosure.
Massachusetts 6.5% 6 months Dividing Ownership: Winning
bid is the person who pays
the total amount due, which is
a lien on the property, for the
smallest percentage of the
property. If the property is
foreclosed, and the purchaser
agreed to take less than a
100% interest in the property,
he becomes the co-owner
with the delinquent taxpayer.
See: MassTaxDeeds.com
Michigan 15% - 50% (15% 12 to 18 months Dividing Ownership: Winning
first year, 50% flat bid is the person who pays
fee for second the total amount due, which is
year) a lien on the property, for the
smallest percentage of the
property. If the property is
foreclosed, and the purchaser
agreed to take less than a
100% interest in the property,
he becomes the co-owner
with the delinquent taxpayer.
Mississippi 18% 2 years Premium Bidding: Bidder
willing to pay the largest
amount of cash in excess of
amount due. If property is
redeemed, the excess amount
is refunded to the buyer.
Section #7: States Where Tax Lien Investing Is
Most Profitable
Page 82 of 89
List of the Most Profitable Tax Lien States
State Interest Rate Redemption Bidding System
Period
New Jersey 18% + 2% - 6% 2 years Bidding On Interest
Rates: Winning bid goes
to the person who will
accept the least rate of
interest on the amount of
tax due. Bidding starts at
18% and goes down from
there. Premium bid is
allowed if rate of interest
is bid down to less than
1%, then premium bid
starts upward.
North Dakota 12% 3 years Bidding On Interest
Rates: Winning bid goes
to the person who will
accept the least rate of
interest on the amount of
tax due. Bidding starts at
12% and goes down from
there.
Wyoming 18% (15% interest 4 years Lottery: The first person
first year, plus flat willing to pay the taxes,
fee of 3%, no interest, penalties and
matter when costs including charges is
redeemed) the successful bidder.
Your number is drawn
and you either accept to
pay or decline. Wyoming
has a 3% flat fee, no
matter when redeemed.
Section #8: Contact Information For The Most
Profitable Tax Lien States
Page 83 of 89
Section #8: Contact Information For The Most
Profitable Tax Lien States
Now that you know the states where your tax
lien investment dollars will bring you the
highest rate of interest, here is contact
information for each of the most profitable tax
lien states listed in the previous section.
For a complete list of counties in each of
these states, please visit the County Phone
List section on our website at
http://taxliensalecertificate.com/countylist.htm.
Our County Phone Lists give you the name, phone
number, and address of every single county in
states where tax lien investing is most
profitable.
The following addresses and phone numbers will
help you get started:
Arizona
Arizona State Treasurer
1700 W. Washington St.
Phoenix, Arizona 85007
Phone: (602) 542-1463
http://www.az.gov/webapp/portal/ (State of
Arizona website)
Colorado
State Treasurer's Office
140 State Capitol
Denver, CO 80203
Phone: (303) 866-2441
http://www.state.co.us/gov_dir/governor_office.html
(Office of the Governor website)
Section #8: Contact Information For The Most
Profitable Tax Lien States
Page 84 of 89
Florida
State Treasurer’s Office
200 E. Gaines St.
Tallahassee, Florida 32399
Phone: (850)413-3100
http://www.myflorida.com/myflorida/counties.html (Website
with list of Florida counties)
Georgia
Georgia Dept. of Revenue
Property Tax Division
4245 International Pkwy, Suite A
Hapeville, Georgia 30354-3918
Phone: (404) 968-0707
http://www.state.ga.us/ (State of Georgia website)
Illinois
State Treasurer’s Office
100 West Randolph, Suite 15-600
Chicago, Illinois 60601
Phone: (312)814-1700
http://www100.state.il.us/government/county.cfm
(Website with list of Illinois counties)
Indiana
State Treasurer's Office
242 State House
Indianapolis, Indiana 46204
Phone: (317)232-6386
http://www.in.gov/tos/ (State of Indiana website)
Iowa
Treasurer of State
State Capitol
First Floor South
Des Moines, Iowa 50319
Phone: (515)281-5368
http://www.state.ia.us/ (State of Iowa website)
Section #8: Contact Information For The Most
Profitable Tax Lien States
Page 85 of 89
Louisiana
State Treasurer’s Office
900 North Third Street
3rd Floor, State Capitol
Baton Rouge, Louisiana 70802
Phone: (225)342-0010
http://www.treasury.state.la.us/ (Department of the
Treasury website)
Maryland
State Treasurer’s Office
80 Calvert St.
Annapolis, Maryland 21401
Phone: 1-800-974-0468
http://www.mec.state.md.us/ (State of Maryland
website)
Massachusetts
MassTaxDeeds.com
Michigan
Michigan Department of Treasury
Lansing, Michigan 48922
Phone: (517)373-3200
http://www.michigan.gov (Office of the Governor
website)
Section #8: Contact Information For The Most
Profitable Tax Lien States
Page 86 of 89
Mississippi
State Treasurer’s Office
1101 Woolfolk State Office Building, Suite A
Jackson, Mississippi 39205
Phone: (601)359-3600
http://www.treasury.state.ms.us/ (State Treasurer’s
website)
New Jersey
Office of the State Treasurer
State House, 1st Floor
Trenton, New Jersey 08625
Phone: (609)292-5031
http://www.state.nj.us/treasury/index.html (State
Treasurer’s website)
North Dakota
State Treasurer’s Office
600 East Boulevard
3rd Floor
Bismarck North Dakota 58505-0600
Phone: (701)328-2643
http://www.discovernd.com/ (State Treasurer’s
website)
Wyoming
State Treasurer’s Office
200 West 24th Street
Cheyenne, Wyoming 82002
Phone:(307)777-7408
http://treasurer.state.wy.us/ (State Treasurer’s
website)
Conclusion: Tax Lien Certificates Are An
Excellent Investment
Page 87 of 89
Conclusion: Tax Lien Certificates Are An
Excellent Investment
So, there you have it – all the information you
need to successfully invest in property tax
liens. You’ve learned all the specifics,
including:
• What tax liens are.
• What why you should invest in tax liens.
• How to buy tax lien certificates,
including the steps involved before,
during, and after the tax sale.
• An explanation of tax sale procedures in
the state of Colorado.
• Useful tips to help you double or even
triple your tax lien investment dollars.
• The risks involved in tax lien
investing.
• A complete list of states that sell tax
lien certificates.
• A list of states where tax lien
investing is most profitable.
• Contact information for the most
profitable tax lien states.
Conclusion: Tax Lien Certificates Are An
Excellent Investment
Page 88 of 89
Keep these points already mentioned in the
report in mind:
• Tax liens earn a higher rate of interest
than Certificates of Deposit (upwards of
10% and more like 20% to 25% interest!).
• Tax liens are a low-risk investment. 98%
of tax liens are eventually paid off in
the state that offer them.
• The law is on your side. You are not
responsible for pursuing the delinquent
property owner to pay you for the tax
lien. State law requires that delinquent
taxpayers redeem tax liens or risk losing
their property.
• If property owners do not pay you back for
the tax lien, you can foreclose and own
the property after the redemption period,
which ranges between 1 to 3 years, and
gain valuable real estate for pennies on
the dollar.
• Investing in tax liens is very easy, much
easier to figure out than investing in the
stock market.
• You don’t have to have a lot of money to
invest in tax liens. You can invest as
little as $100!
• You do not have to live in the state to
invest in their tax liens. States that
Conclusion: Tax Lien Certificates Are An
Excellent Investment
Page 89 of 89
sell tax liens offer them to virtually
anyone, anywhere.
• Even if you miss out on a state’s
scheduled tax sale auction(s), you can
still invest in their counties’ leftover
liens and find some great bargains.
Most importantly, tax liens are by far one of
the most powerful and safe investments you can
make, because you will get a guaranteed return
on your investment that is backed by the
government itself. You can’t say the same for
the stock market where so many people have lost
millions of dollars. Making money on tax liens
is not a game of luck as it is in the stock
market. With tax liens, you know the exact
interest rate your investment will make in a
relatively short period of time.
And, remember, tax liens from the government is
a real opportunity that many people all over
the United States are doing and earning lots of
money doing it. This report is simply intended
to give you the facts you need to quickly
figure out the ins and outs of tax lien
investing so that you don’t have to spend hours
of research figuring it out yourself. If you
follow the guidelines in this comprehensive
report, you will be well on your way to earning
safe, high-interest, low-risk investment
returns.
