Tax Lien Certificate
Tax Lien Certificate
# Entrepreneur of the Week Post 3
Hello to the whole forum,
Third post, today we will discuss an interesting area called the Tax Lien Certificate.
the definition of Tax Lien Certificate Is: A tax lien certificate, is a certificate of claim against a property that has a lien imposed on it as a result of taxes on unpaid land. Certificates of tax liens are usually sold to investors through a tender procedure. Auctions are held only in countries that allow the auctioning of these liens. As I mentioned in yesterday's post there are states in the US that allow these tenders and some do not, make sure before you go to such tenders.
The most common mistake in this area is the lack of knowledge of the differences between the Tax Lien Certificate and the Tax Deed. The main and most important difference between the two is that you hold a lien against the property (Tax Lien Certificate), on which you receive a guaranteed interest from the government at a certain percentage set during the auction, however, a tax deed which is the property of the first time Of the sale.
Every U.S. county actually relies on property owners to pay their taxes on time so the county can pay for the public services it provides such as:
Firefighters, police, schools, salaries, etc. When a property owner does not pay his tax it puts the local district and the government in a “suffocation” of cash.
Firefighters, police, schools, salaries, etc. When a property owner does not pay his tax it puts the local district and the government in a “suffocation” of cash.
At this point the investor actually enters “in the shoes” of the debtor property owner and lends to the district the money in exchange for a pre-guaranteed interest rate set at the auction.
This loan is called Tax Lien Certificate.
This loan is called Tax Lien Certificate.
There are states and counties that give up to 18% interest (Arizona State) or 24% interest (Iowa State) on this loan (although it is very difficult to get such interest because there are many jumps to these sales). If the debtor does not pay his debt within a period of up to one year from the sale of the encumbrance certificate + interest set for him, this is what is called Jackpot !!!!!! As in a casino… ..the property is offered for auction as a tax deed and then he loses the property completely and we have a chance to win the property at a minimum cost to its true value. This is the best thing that can happen because the lien is a top priority over any other debt that exists on the property including a mortgage and so on.
You get the property without any liens, in English it is called - FREE AND CLEAR, MORTGAGE FREE.
You get the property without any liens, in English it is called - FREE AND CLEAR, MORTGAGE FREE.
By the way, statistics say that almost 95% - 97% of debtors pay the debt including interest and only 3% - 5% of the assets go to auctions.
U.S. banks have discovered the power of these bond certificates and are in fact investing a great deal of money and effort in participating in these sales. For example:
When we come to the bank and deposit money with them in a savings plan, they give us maybe 1% interest on the money…
They take the money and invest it in certificates that will work and get a promise of 4% interest on their loan to the province and thus earn on our back 3% easily
(Not to mention more than that in counties that give more than 4% such as Arizona ..)… Delusional but very real.
When we come to the bank and deposit money with them in a savings plan, they give us maybe 1% interest on the money…
They take the money and invest it in certificates that will work and get a promise of 4% interest on their loan to the province and thus earn on our back 3% easily
(Not to mention more than that in counties that give more than 4% such as Arizona ..)… Delusional but very real.
What remains to be done now, decide that this is what you want to do, find the country that suits you and learn the business from local professionals because otherwise, do not go to tenders.
Again, because without professionals you will lose your money and that is not our goal.
Again, because without professionals you will lose your money and that is not our goal.
A small and genuine curiosity about the state of Florida…. Until about three years ago a smart guy opened about 200,000 LLC companies in the country,
And all of them he would put into the tenders of bond certificates, in this way he would surely be the winner of every tender.
Needless to say, the guy made millions !!!!!, now this option is blocked and therefore more likely to win.
And all of them he would put into the tenders of bond certificates, in this way he would surely be the winner of every tender.
Needless to say, the guy made millions !!!!!, now this option is blocked and therefore more likely to win.
Tomorrow's post will deal with Overages an important concept in the auction.
Another very, very important point: when you become the happy owner of such a bargain, keep in mind that the property will not be able to be sold at a "regular" sale in the future… The sale of this type of property will take an average of 70 to 90 days…. (From personal experience of over 50 such transactions in the last three years, in the state of Florida)…. Sorry to say but not recommended at all…. Surrey
And oooh, there is much to be learned from America.
Perfect solution.
Well done on the post
I was waiting for this post! Thanks so much for the great information !!!