Tax lien investing can be a very profitable strategy. It isn't a well-known method, but thousands of people have been using tax liens in order to make money and build wealth for years. It's a form of investment that, unlike the trading on Wall-Street, is accessible and potentially profitable to everybody who is interested. The problem is that most people don't realize how investing in tax liens works and how they can make money from the practice. Getting into tax lien investing is easier than you think and will allow you to stop relying on one source of income. For some people who become successful at investing in tax liens, it becomes their sole source of income as they make more money.
There are three main forms of tax lien investing. They are tax liens, tax deeds, and redeemable deeds. All three have core differences that change how people make their investments. Each form of investment has its pros and cons as far as immediate profitability, risk, extra costs, and other factors. It is important to do your due diligence and first see what kind of investment you want to get into. All forms of tax lien investing are available for you because the owner of the property did not pay their property taxes, causing a revenue shortfall with the local government. The city or county has budgetary obligations that they have to meet regardless of if the taxes are paid on time. So to make sure that they get that income, they hold auctions that allow you to "buy" the property owner's tax debt, which the owner will have to pay back to you, plus interest. This is the core concept of a tax lien. In more extreme cases where the owner has not paid their property taxes for an extended period of time, the county will hold auctions for the deed of the property. Once you buy the deed to the property, you are the property owner and can move into the property or rent it out to others. This is the concept behind tax deeds and redeemable deeds. The big difference between tax deeds and redeemable deeds is that with redeemable deeds, there is a redemption period after you purchase the deed. During this period, the original owner of the property can buy the property back from you, at a cost of 100% of what you paid plus a state determined penalty percentage.
With a tax lien, you are probably going to get a return on your investment over a few years time. But with tax deeds or redeemable deeds, you can get your money much faster. Once you own the house, you can rent it out or sell it to others who are interested. In the case of redeemable deeds, the owner might quickly buy the property back from you in the redemption period, plus the penalty money. However, tax liens are the safer investment. In the case of tax deeds and redeemable deeds, you might get stuck with a worthless property or something that nobody, including the original owner, wants to buy. That's why it's important to do your homework on every property that you intend to bid on.
There are many strategies you can use to become a successful Real Estate Investor in the Maryland, Washington DC, and Virginia area. Tax Lien or Tax Deed investing makes sense because you're able to purchase liens or deeds that will yield you up to a 24% return on investment! Realizing a greater return is the ultimate goal for a Tax Sale or Tax Deed investor.
Rehabbing Houses, Wholesaling Houses, Short Sales, Lease Options, Rent to Owns, REO's, Tax Sales and Tax Deeds have been a staple of Real Estate Investing since the beginning of time.
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
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