Tax liens, deeds and certificates? Have you heard of these? For some, it is but a complicated topic that needs no further intrusion. While for some, this is a vehicle towards financial freedom. To begin with, these enable investors to make serious money by buying distressed properties from delinquent taxpayers. Though not considered as real estate investing, it offers one of the superior returns on investment.
You
might be confused when you hear about tax liens, deeds, and
certificates. What are these and what are their similarities and
differences? To help you further understand, read more:
Tax Liens
When a taxpayer fails to pay their taxes within a specified period, the federal government will issue a lien on the taxpayers' property. The purpose of the home lien is for the government to force the residents to pay their duties, and to eliminate the liability.
When a taxpayer fails to pay their taxes within a specified period, the federal government will issue a lien on the taxpayers' property. The purpose of the home lien is for the government to force the residents to pay their duties, and to eliminate the liability.
Another way
for the government to lessen their liability is to sell the property
lien in public. When a buyer purchases a lien, either through an auction
or sometimes from the tax collector's office, the buyer assumes
responsibility for it.
The buyer will earn from the ownership of
the lien through guaranteed interest rate returns from the government
plus the payment of their initial investment, i.e. the money they paid
to purchase the lien. However, buyers have a little chance of owning the
property unlike buying and owning a tax deed.
Tax Deeds (also called title)
Based on investopedia.com, deeds are a legal document that grants ownership of a property to a government body when the property owner does not pay the taxes due on the property. Moreover, realtor.com defines deeds as the legal document indicating ownership of the property. Here, the government will intercede to place distressed certain properties at an auction.
Based on investopedia.com, deeds are a legal document that grants ownership of a property to a government body when the property owner does not pay the taxes due on the property. Moreover, realtor.com defines deeds as the legal document indicating ownership of the property. Here, the government will intercede to place distressed certain properties at an auction.
This allows the government the authority to sell properties through a tax sale.
After a deed is placed over the property, the government will soon
collect taxes by selling the property to prospective investors. The
investor will pay the taxes to the government in exchange for the title.
In return, the investor will assume ownership of the property.
Take
note that compared to those property lien certificates in which buyers
earn income in the form of interests from the lien, the deed owners has
the potential to own the property if the owner-taxpayer fails to pay
their taxes on time.
Tax Certificates
Also known as tax lien certificates, this is a certificate of claim against a property because of unpaid property tax. Moreover, a website states that tax lien certificates for buyers are considered 'first lien' on a delinquent property that yields the holder of the certificate high interest rates.
Also known as tax lien certificates, this is a certificate of claim against a property because of unpaid property tax. Moreover, a website states that tax lien certificates for buyers are considered 'first lien' on a delinquent property that yields the holder of the certificate high interest rates.
If the certificate is issued by the county office
to the buyer, the property owner must pay the original amount of taxes,
charges and interest accrued.
Typically, investors who want to
purchase lien certificates can buy from their local county office --
although most are available through auctions.
Difference across the States
According to the National Tax Lien Association, United States is divided into three sections: states that sell tax liens, states that don't and states that have enabling legislation's to sell encumbered liens. Currently, there are 30 states that sell liens, 18 states that do not sell, and 2 states - California and Wisconsin - that enable their legislation's to sell tax liens.
According to the National Tax Lien Association, United States is divided into three sections: states that sell tax liens, states that don't and states that have enabling legislation's to sell encumbered liens. Currently, there are 30 states that sell liens, 18 states that do not sell, and 2 states - California and Wisconsin - that enable their legislation's to sell tax liens.
Apart from these, states also
differ from the rate of return, existing statues, auction and bidding
process as well as the redemption period. For example, a tax lien can
earn as low as 10 percent in Missouri and as high as 36 percent in
Illinois. During the bidding process, bidding down the interest - used
in Florida and Arizona - differs from what is used in Colorado and other
states.
The sky is the limit.If you are interested in learning more about Tax Deeds and Liens, you should click on the link below. It is a great place to get started if investing in real estate is what you are looking to do. Yes, you can still make a fortune in Real Estate with this Ultimate Real Estate system. >>> http://bit.ly/1ukjzFZ
The sky is the limit.If you are interested in learning more about Tax Deeds and Liens, you should click on the link below. It is a great place to get started if investing in real estate is what you are looking to do. Yes, you can still make a fortune in Real Estate with this Ultimate Real Estate system. >>> http://bit.ly/1ukjzFZ
Tax liens, deeds and certificates - these might be complicated
but they can help you achieve financial freedom especially in these hard
times. For more information, visit one of America's leading tax lien
expert at http://www.tedthomas.com
Article Source:
http://EzineArticles.com/?expert=Curtis_Cauthen
No comments:
Post a Comment