Tax Sales

by Charlotte Wood
(last updated February 21, 2009)

It's not uncommon to hear of people buying foreclosure property at super low prices and then proceeding to make a profit. How that property is acquired is through what is called a tax sale and can be a rewarding investment for those who have the means to do so. If you can note the distinctions in the different types of sales you participate in and know what's what with the property you want to buy, you could be in a good position to make some money off of foreclosed property.

A tax sale is basically just the sale of a foreclosed property. Tax sales further fall into two separate categories: tax lien sales and tax deed sales; with whatever sale you participate in however, you are in essence paying the taxes for the delinquent homeowner. With a tax lien you receive the right to the lien, allowing someone else to bid on the tax debt. With a tax deed sale however, the deed to the property is given outright to the buyer. When you buy a tax lien or deed you're essentially taking the pressure off the bank or government and making the homeowner indebted to you. With these a lien sale you can receive rights to the principal plus any interest and then if the homeowner doesn't or can't pay what they owe, you can foreclose and take the property outright. Both options—the lien and the deed—have their benefits and perks.

Before you go into a tax sale though, make sure you know what kind you're going into and what rules apply. Different counties have different rules and you should know those before you go in. Tax sales are a great way to make money and are great ways to invest. If you have the money, you should definitely look into tax sales and you could succeed in making a significant profit!

Author Bio

Charlotte Wood

MORE FROM CHARLOTTE

Dealing with Bleach Damage

Bleach on your pants is never fun and almost always puts a kink in your style. The best way to avoid this predicament is to ...

Discover More

Effective Debt Counseling

Debt counseling can be a great way to plan your way out of debt and pave your road toward financial freedom. You just need to ...

Discover More

Reducing Your Garbage Bill

Depending on where you live and what services are available, you may be able to better control your garbage bill. If you're ...

Discover More
More Money Tips

When Are Taxes Due?

Taxes are a pain and especially when you end up doing them last minute. But how do you know if you're doing them last minute ...

Discover More

What is the Inheritance Tax?

The people receiving the inheritance pay an inheritance tax. Each beneficiary is responsible for paying his or her own ...

Discover More

Taking Care of Back Taxes

If there is one thing that just about anyone can agree too, it is that time has a tendency to get away from us. This isn't ...

Discover More
Comments

If you would like to add an image to your comment (not an avatar, but an image to help in making the point of your comment), include the characters [{fig}] in your comment text. You’ll be prompted to upload your image when you submit the comment. Maximum image size is 6Mpixels. Images larger than 600px wide or 1000px tall will be reduced. Up to three images may be included in a comment. All images are subject to review. Commenting privileges may be curtailed if inappropriate images are posted.

What is 6 + 0?

There are currently no comments for this tip. (Be the first to leave your comment—just use the simple form above!)