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3 Responses to “• Profiting From Tax Liens | My Taxes”
How to make a profit buying tax liens…?
Ok so if I understand the process correctly, I buy a tax lien from a city/county, whatever…after 2 years I have the right to sell the property that is being taxed to recover the tax owed plus interest ( whatever rate I bid for)…the property goes for public auction, gets sold, i get paid…
1. What happens if the owner declares bankruptcy?
2. Does my lien trump all other creditors or do we all get paid in order of who filed a lien first? If someone owes a $500K mortgage and the home gets sold for $10 do I simply lose my right to get paid?
3. If the auction is public, I get no special consideration to purchase the property first, do I? I am just like any other buyer looking to purchase a foreclosure although I own a tax lien, correct?
Any assistance is greatly appreciated
P.S. If anyone knows the answers to these questions as they pertain to Florida in paticular I’ll be your best friend….
Comment made on February 13th, 2010 at 6:10 pmI am not familiar with Florida Laws. However some of the answers are generic across any state.
Answers.
1. Tax Certificates are not knowingly sold on parcels involved in bankruptcy or litigation. If bankruptcy or litigation occurs after a certificate is issued, the court may determine the amount of interest to be paid. Bankruptcy and litigation may extend the life of a certificate and places an automatic stay on the Tax Deed Application process.
2. Your lien has the highest priority over mortgages etc. The $10 buyer must pay your tax lien in order to take title.
3. Tax Deed Applications
Any time after two (2) years have elapsed since April 1 of the year of issuance of the tax certificate and before the expiration of seven (7) years from the date of issuance, the tax certificate holder is entitled to submit a tax deed application. The tax deed application must be submitted between the 1st and 10th of the month with required documentation and payment.
Tax deed applications will not be accepted prior to April 1st on tax certificates issued as result of this sale.
The tax deed applicant must pay all fees and the cost of the ownership and encumbrance report pertaining to each tax deed application in accordance with Florida Statutes.
Transfer /assignments for tax deed applications must be submitted before the 10th of the previous month to allow for processing and update(s) to monthly reports.
The Applicant is not guaranteed title to the property. This will be determined by the Tax Deed Section of the Clerk of the Court upon completion of the tax deed foreclosure sale.
Comment made on February 13th, 2010 at 11:12 pmReferences :
do not get involved in that. The courts can tie you up for years and you may never recover your money. Much more to be made by offering desperate sellers lease to purchase contracts and reselling them. Its all cash and nothing is ever in your name so you never have to pay income tax on it
Comment made on February 13th, 2010 at 11:14 pmReferences :
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