If you want to know how to purchase a tax lien then this short article will help you get started. If you’re new to the area it can be really confusing how this all works! Don’t worry because im here to clear up all of this confusion for you!

The best thing about tax lien investing is that it does offer some sort of security. Land is always a good investment because of this and is great for those who are not huge risk takers. When you purchase a tax lien you will always have the land in the end if worse comes to worse. Just keep that in mind and you will realize that it’s literally one of the smartest investments you can make.

When property owners fail to pay their taxes the property is seized and their loss becomes an opportunity for you and me. Now to actually purchase a tax lien certificate you will need to attend an auction. But if you’re smart you will do your research before just jumping into a bid. You should get the lot number from the auction before hand and check out the land. Make sure that the land is in good shape and is located in an area that guarantees resale.

Tax lien auctions are not that hard to understand. Many communities usually hold them 1-2 times a year so just do your research. To become a qualified bidder for the auction you need to prove that you actually have cash in your hand and are ready to purchase. Unlike the standard auctions where high bids win the auction it’s the low bids that end up winning. What I mean by this is simply that the bidder who bids for the lowest interest rate is the one who will walk away with the tax lien. Good luck!

Learning how the tax lien auctions work can be a very rewarding process in the end. It’s important to know how all of this works because it can be worth a lot of money in the end. With that being said lets go ahead and take a quick look at the process shall we?

Tax lien auctions are really not much different than the standard auction that most of us love and hate. Each state and county has different rules when it comes to tax lien auctions but the standard structure remains the same. But you seriously might want to consider checking out your state and county to make sure what special terms they have for the auction before going to one.

The auctions are usually held at the county courthouse and most require immediate payment after the auction is completed. It’s very important to research what you are bidding on days before the actual auction starts. You want to know what you are going to be purchasing so be sure to do your research here.

The person who bids on the lowest interest rate will come out as the winner, so the auction is reversed so to speak compared to the standard auction your most likely use to. In some states though the bidding process is not even present and the properties are just listed with the counties. If this is the case then the first person to show up and front the tax money to purchase the land is the winner.

Most states today go by the actual bidding process with the auctions and even give the original property owners a little time to come up with the tax money. But like I said before, it’s very important to check out how your state and county “play the game” to get the full advantage over your competition.

If you’re a new tax lien investor, the time comes when you find a property lien that you’re interested in buying. You’ve read Tax Lien Riches, done all your research and submitted all the appropriate forms. The only thing left to do is attend the auction and win that investment. Here are 3 Success Strategies for Bidding on Tax Liens. If the auction is your first one, these will be particularly helpful for you. If followed, these tips may prevent you from losing the lien.

1. Hang Back, Jump In – Newcomers to tax lien bidding are well advised to spend the first while watching and listening. You’ll be able to acquaint yourself with the procedure used by the county you’re in, and align yourself with the tempo of the competing bidders. Typically, there isn’t a second to lose in the fast-paced world of tax lien bidding. Hesitation in placing your bid can lose the lien for you. So sit out for a bit and observe. Then, matching the pace of your competitors, start bidding in a loud, clear voice.

1. Time to Go, Stay Put – It stands to reason that at a day long auction, many of the bidders will leave for a lunch break and some will leave before the auction is over. It is precisely those times that add opportunity for you if you are one of those who stays. There’s less competition as there are fewer people in attendance. Take advantage of this strategy to make more money!

1. Size Does Matter – Many times you may find large financial institutions among your competitors. If you have a chance to bid against them, one word of advice – don’t. With millions of dollars at their disposal, you will not make much profit if you manage to win a bid. They don’t need to make a large margin, but making as much profit as possible should be one of your goals.

There are more bidding strategies, and I would really suggest that you read Tax Lien Riches from www.taxlieninvestingguide.com to learn the rest of them, but these are important ones that can assist you a great deal with your tax lien bidding.

One other final piece of advice that I can offer is, stick to the smaller counties. This is especially good during your learning curve. Often, there are fewer attendees, and not enough liens to attract the big banking institutions.

I wish you the very best of luck as you continue to travel a profitable road. I hope that these 3 Success Strategies for Bidding on Tax Liens will help you on that journey.

If you are new to tax lien investing, you may be tempted to get your feet wet by purchasing cheap liens. By cheap, I mean less than $500. Understandably, it seems like a low cost way to learn the ropes and ease into this type of investment. While it is possible to do very well, the reality is that you need to exercise extreme caution when it comes to Cheap Tax Lien Investing.

The main problem with cheap tax liens is that they are usually associated with properties which have little or no resale market. A worthless lot, or one that is hard to sell is going to change that cheap tax lien from an asset to a liability. This is not the type of investment you want.

Another downside is the fact that the types of properties mentioned above seldom get redeemed. Usually, the owner of a property will pay their lien off within the specified period of time and take back ownership. In the case of a worthless piece of land, the owner often doesn’t bother. You can get stuck with it.

How do you know if a property is worthless? First of all, do your homework well. Research the property enough to know what you’ll be getting into if you buy it. For example, is the listing just a tiny lot that can’t be used for anything? Perhaps it’s nothing more than an access route for other properties, or has hazard wastes and like. These are things you need to know to avoid ending up with them.

Typically, the more valuable properties have more expensive liens. That makes sense of course, but shouldn’t stop you from practising due diligence. Check those properties out, too. Your best bets are to look at liens over $500 or $600 with single family homes on the land. They tend to have a lower incidence of the problems mentioned previously.

Armed with the knowledge of your research, you should be able to bid on a lien with a fair bit of confidence. I would suggest that you also read Andrew Kestler’s book, Tax Lien Riches before attending the auction to prepare yourself for the bidding process, as well. It is available at www.taxlieninvestingguide.com.

Don’t be scared off Cheap Tax Lien Investing, just be cautious. You will occasionally come across a good property for cheap, but that will be the exception not the rule. Do your homework, read Andrew’s book, and you’ll not only do well, you’ll make a lot of money, too.

You may already know that Tax Lien Auctions are terrific for picking up your next guaranteed high yield investment. Are you aware though, that if you fail to do your homework that you could have a problem? One missed formality can get you disqualified from bidding.

“Tax lien auctions are fairly simple. However, there are some key details you should know before you attend your first auction.”

Andrew Kestler, author of Tax Lien Riches

What You Need to Know About Tax Lien Auctions

The required forms and information varies from state to state. You really need to learn as much as you can in order to take advantage of tax lien investing, but it pays off so well, that you’ll be very happy that you did your due diligence.

In some states, you must pay for the tax liens immediately upon winning the bid, while others ask for a 10% deposit right away, with the balance due at the end of the day or sale. You have to know before you go what the payment policy is, and how it needs to be implemented.

You’ll also need to check with the county that you’re planning to bid in as to whether or not they charge an entry fee for the auction. Many are free, but not all of them. For example, one county in Iowa charges $100.00. If there is an entry fee, find out when it must be submitted by. Typically, it is due with your registration.

Before you are allowed to bid on a tax lien, you must present a fully completed W-9 tax form. This is important enough that if you forget it, you may as well stay home. It is best for you to find out if there are any other papers that you need to file, as well.

Another thing to check with the applicable county is their registration deadline. Some accept registrations a couple of days prior to the auction, others require it a week ahead of time. If you miss the due date, you won’t be allowed to attend the auction or bid. Tax lien investing is profitable and safe, so you are not going to want to miss out.

Preparing for Tax Lien Auctions is a fact-finding mission and forms gathering exercise. Every state has its own set of rules and policies that you should know prior to attending your first auction. Find out everything you can about how the process works, and you will have a distinct advantage and smooth transaction. If you would like an easy to understand manual that explains in detail, pick up a copy of Mr. Kestler’s book at www.taxlieninvestingguide.com.

Happy bidding!