| Tax sale jargon can be extremely
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| | lien, then you could wipe out the
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| confusing. There are tax lien sales and
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| | mortgage and own the property free and
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| tax deed sales. As if that wasn't
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| | clear! Isn't that great! On top of that,
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| confusing enough, there are also hybrid
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| | you are making an interest rate that is
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| sales called redeemable deed sales. Once
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| | much higher (as much as 24%) than what
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| you understand the differences, you can
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| | the mortgage company is collecting.
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| wade through this goldmine and make huge
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| | Now that you understand the basics of tax
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| profits!
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| | liens, let's review tax deeds. In the
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| Tax liens are simply a lien on the
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| | case of the tax deed, the county simply
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| property. From the homeowner's
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| | holds the lien for several years and does
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| perspective, you are simply a creditor,
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| | its own foreclosure. Then, they hold an
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| much like the mortgage company. Mortgages
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| | auction and you buy the property. It's
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| and liens are in what are called
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| | very similar to a traditional mortgage
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| "positions." The big loan that you got
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| | foreclosure auction.
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| when you bought your house is the first
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| | The third type of tax sale is called a
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| mortgage, and usually has a very low
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| | redeemable deed sale. The most notorious
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| interest rate. If you did an equity line
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| | redeemable deed state is Texas. In Texas,
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| or borrowed additional funds, then you
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| | the investor buys the property at the tax
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| also have a second mortgage. Second
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| | sale, but the homeowner has a specified
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| mortgages are always at a higher rate
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| | period of time (six months to two years,
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| than the first mortgage because the
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| | depending on the type of property) to buy
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| lender takes more risk. In the event of
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| | back, or "redeem" their property. In the
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| foreclosure, the lienholders are paid off
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| | meantime, the investor can take
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| in the order of position, which means
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| | possession of the property and even rent
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| that the first mortgage holder is paid
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| | it out. In the event of a redemption, the
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| before the second mortgage holder.
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| | investor gets a very nice 25% annual rate
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| So, what does this have to do with tax
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| | on their investment in Texas.
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| liens? The position of tax liens is even
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| | As you can see, tax liens and deeds vary
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| higher than mortgages. If the homeowner
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| | greatly by state. Before making any kind
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| refinances, the tax lien must be paid. If
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| | of investment like this, proper research
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| the homeowner sells, the tax lien must be
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| | of state and local regulations is
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| paid.
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| | essential. With the proper tools, a
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| If you foreclose on your tax lien and the
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| | massive goldmine awaits.
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| mortgage company does not pay off your
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