Is there such a thing as tax lien investing that is done for you,
where you just give your money to someone else and let them do all the
work for you?
Can you purchase profitable tax certificates without doing the due diligence and going to the tax sale yourself?
There
are 2 ways that I know of where you can not only have someone do all
the work of buying profitable tax liens or tax deeds for you; they
manage your portfolio and take care of any redemptions or foreclosures
for you as well. You can use a tax lien investing agent or you can
invest in a tax lien fund. With either of these tax investment methods,
someone else does the work of getting the tax sale list, doing the due
diligence, bidding at the tax sale, managing the portfolio, and
foreclosing on properties. You just sit back and collect the profit.
So how does it work and what's the difference between investing with a lien agent and investing in a tax lien fund?
With
a lien investing agent you have a little more control over your
portfolio, you can actually stipulate what type of properties or liens
you want, control whether or not you pay the subsequent taxes, or start
foreclosure on a property. You also have control over whether any profit
that is realized gets re-invested. Lien certificates and tax deeds are
held in your name, so they are your assets. The agent will set up an
account for you and assign to you liens and/or deeds that they purchase
at the tax sale. There is usually a onetime set up fee to set up your
account with them and quarterly or yearly management fees.
When
you invest in a tax lien investing fund you don't have as much control
over which liens or deeds you purchase and how or if the profit is
re-invested, this is all dictated by the fund. The plus side is that
since you are buying shares in a fund, not investing through your own
private account, there are usually no upfront fees. There is a
management fee but for smaller funds these fees are typically low.
If
you've wanted to invest in tax certificates or tax deeds, but you just
don't have the time to do the necessary due diligence or to bid at the
tax sale, you may want to consider using a lien agent or investing in a
lien fund. If you live in a tax deed state, but you want to invest in
tax certificates (or visa verse) it would be a lot less expensive to use
a lien agent or invest in a lien fund then it would be to travel to
another state to invest in tax liens.
Investing with an agent or
in a fund is a great way for foreigners to invest in US tax liens or
deeds. The process is easier because you have a U.S. entity bidding for
you. You still would need to have a U.S. tax ID number, but you may not
need to have a U.S. bank account, which is a requirement for all of the
online tax sales, and there is no need to go to through the trouble and
expense of setting up a U.S. entity just to bid at the tax sale,
although you still may want to have an entity to hold any properties
that you acquire through tax sales.
Agents and fund managers have a
lot of experience purchasing tax certificates and tax deeds at the
sale. They know the buying strategies that make the most sense and they
are able to get the highest returns for their clients. They can usually
do better than you can at the tax sale, getting more successful bids at
more profitable rates. They have teams set up to do due diligence on tax
sale properties, along with access to resources that you might not have
access to. This helps them to be better able to get more properties or
more liens at better returns than you could on your own. They are
professionals after all. This is their job, it's what they do for a
living, and they're good at it. It would cost you more to have access to
the services and resources that they have access to than the small
management fees that you pay to have them do the work for you.
To receive your
FREE Tax Lien Investing Kit, that has helped thousands of investors,
just like you learn how to build their own profitable portfolio of tax
lien certificates or tax deeds go to http://taxlieninvestingkit.com/.
Article Source:
http://EzineArticles.com/?expert=Joanne_Musa
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