he exact definition of a buy or get a loan on this
tax lien is a charge property until the lien is
against a property by satisfied (paid in full.) This is
operation of law. Tax liens and why government-issued tax liens
assessments take priority over are such a safe investment;
all other types of liens. because you are guaranteed to
receive either your money or the
In simple terms, if a property property. The concept is that you
owner doesn’t pay their property are stepping in the government’s
taxes, a lien is levied by the shoes for a while and paying them
county to collect the taxes, for a lien they placed on the
which they then sell to property (because the property
investors. owner didn’t pay their property
taxes) which entitles you to the
Basically, unpaid taxes become a state mandated interest rate on
lien filed with the county the the amount you purchase the lien
property is located on until the for (again, this rate is anywhere
taxes are paid. If the taxes from 8% to 50%.)
aren’t paid for a predetermined
amount of time, the owner will The reason the government offers
lose his or her property. While this tremendous opportunity boils
this is happening, a penalty is down to that age-old, simple
added to the lien ranging from 8% concept – money. Without money,
to 50% per year. THAT is where the county government cannot
you’re looking for a guaranteed exist. Think of just a few minor
return on your investment. things that money will cover:
Let me back up a minute – when ** Road repairs/street signs
there is a lien on a property, it ** Police salaries
basically means that no one can ** School funding
will always get their tax
Did you know that in some dollars, while the smart
counties over 60% of their investors are making fortunes
revenue comes from property buying these liens. Remember, you
taxes? I’m sure you can see why are not buying the lien itself;
the government can be more than you are buying the tax lien
happy to place a lien on a certificate offered by the
property and sell it to you for county.
the interest.
The counties really don’t want
Think about it; they collect these liens; they’d rather have
their money from you buying the the money! This way they’re not
tax lien—they’re happy. They are stuck holding the lien until the
charging sometimes ten times the property owner finally pays—which
interest of a CD and guess what? sometimes never happens anyway.
They aren’t paying the interest;
the homeowner is. The government
About the Author:
To Learn More, please visit Investing In Tax Liens
Read more articles by:
Mike Lucas
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