2012年7月21日 星期六

Tax Lien Investing - Myth, Mystery and Your Money


Typically, you will be watching an infomercial, where a sexy lady is half undressed standing next to a someone who has been successful in tax lien investing.? The claim is made that you can invest your money into a guaranteed government backed program that allows you to purchase real estate at pennies on the dollar. They show examples that of real estate that has been purchased for pennies on the dollar in order to prove the point.

The truth is that if you are going to purchase real estate for pennies on the dollar, it is possible, but it takes time and knowledge in order not to loose money. First of all you will need to purchase tax liens on the property that you are interested in buying. Then you will need to wait for a period of time (up to 5 years) and hope that the owner does not pay his taxes. By the way 95% of them are redeemed by the owner of the property. Then after you foreclose on the property and it is yours!

Sounds easy? Wrong! First, they are not easy to find; second, they are not all property, they include utility right of ways, mineral rights, and worthless property; third, the county charges a fee to the investor, plus some counties require a deposit; and last of all, the larger counties charge a fee for just the opportunity to get your hands on the data showing all of the available tax liens.

Now to get right down to it, how do you avoid making bad decisions when purchasing tax liens?

Certificates are issued from individual counties seeking cash flow.? A lien is placed on real property when the taxes are not paid by the tax payer.? The investor buys the certificate for face value plus a fee, and then is promised by the county a fixed interest rate until the tax payer pays the taxes. Most tax lien certificates are paid by the tax payer. When the taxes are paid, the investor is paid the face value of the certificate, plus interest for the time that the taxes were delinquent.

It is not guaranteed that the tax lien investing investor will make money when he invest; in fact he can and will loose money if he lacks the education and experience. Just a few examples include: buying certificates from online forums, eBay or other online auctions; purchasing them directly from the government entity, paying the fees, then the tax payer pays the taxes the next month; buying tax lien certificates on a property that is not able to be sold for more than the taxes are worth.

With the proper education and experience any investor can take a good real estate portfolio and beat the interest rates given by money markets or the stock market.? But there are ways to loose money investing in them.




Tax Lien School, LLC is a company dedicated to teach the truth about tax lien investing. They make it possible for educating anyone from any background to learn the business of tax lien investing. They have an article entitled "Avoid the Pitfalls of Investing in Tax Lien Certificates " that they give away for free which is a good place to start. They also have a detailed book that they sell entitled " Tax Lien Investing - Myth, Mystery and Your Money" which is a must buy.

Tax lien investing is a learned skill and is always improved by having someone who has been successful teach you and hold your hand so that you can get the best out of your hard earned money. Get the schooling that you need before you invest.





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