Who, Why, Where, When and is it real?
There are numerous reasons why you want to consider investing in tax sales, but the primary reason anybody invests in anything is to make money. The question is can you invest in tax sales and make money without a great deal of risk....the answer is a definite maybe.
What kind of return can you make, if you do it correctly? The answer will shock you, in fact you will not believe it. There are people who are making 30% to 150% on their money consistently from tax sales. There are also people losing 100% of their money. What makes one succeed when the other fails? The answer is simple, lack of information.
Why is the information difficult to acquire? The reality is it isn't hard to acquire but there are so many "gurus" out there selling bad information that finding the good information can become a matter of "kissing a lot of frogs before you find your prince". Before you plop down a lot of money from someone promising you will make a lot of money, check out the facts. How much tax sale investing have they done? Where did they do it? When did they do it? And make sure you get facts, not a line of bs. Make them give you dates and sales they went to. Make them tell you how many they bought. What were the results? What was the name of the company they bought the tax sale properties through. AND THEN CALL THE COUNTY, CITY, OR TOWN and verify that they are telling you the truth.
Most of the "gurus" will fail this test because they haven't really done it. There are a couple out there who have, but most haven't. Don't spend more than $1,600 hundred dollars for anybody's "course/program/coaching". Anything above that is outrageous. Find out what else they do...can they give you data on tax sales..are they recognized in the business? Check the web for customer satisfaction at places like ripoffreport-com or other sites and check the "gurus" name and/or check the company name. This is all public information.
If you get good instruction, you can make very good money from tax sales. What is good instruction? You should be taught how to determine which sales you should go to. You have to be taught how to do the research on the properties. If somebody tells you to do OTC (over the counter liens)....run like hell, it is a formula for disaster. You should be taught how to use the internet for your research (there are a number of wonderful tools that cost nothing to use that can make your job much easier). You should be taught how to bid at and buy at the internet sales that now exist. You should be taught how do the things required by law after the tax sale and how to get them done easily. You should be provided with tools that will make getting the tax sale lists easy.
How do you go about investing in tax sales? First you have to get the list of properties available. There are over 12,000 different tax sales every year in this country. There is one web site that posts most of those lists, it is taxsalelists.com, they aren't free but they do have them in excel. You can get the lists directly from the taxing jurisdiction, again, it is usually not free and most of those will be in newspaper form, which isn't quite as convenient as excel.
Once you have the list of properties you need to eliminate those that you are not interested in so you do not waste time on them. This is done by sorting the properties based on what you want to buy. Everything is on a tax sale. You will find single family residential properties, commercial properties, agricultural properties, vacant land and industrial properties (be careful with those). So whatever you might be looking for is probably on the tax sale.
You need to know the various bidding methods on tax sales, there are several different ones used: Round Robin, Lottery, Bid down the rate, High Bid, Percentage of ownership and others.
You need to know the games that people play at sales...there are a number of different things you will see.
If you check around you can find some good sources for this information and there are a couple of good courses that are taught, but if the people you are talking to want you to spend a lot of money for their "instruction" then run. There are companies out there that charge between $3,500 and $15,000 for training. Anybody that wants that much money from you for training or coaching should be suspect. After all, you can get a full year of a college course on just about any subject for less than $3,500 (even at Harvard). Instruction should be no more than $100 an hour.
In summation, Investing in Tax Sales can be very profitable. I have made well over six figures a year doing it for over 20 years. It is not rocket science, but whoever you pick to teach you has to have done it. They have to do teach you at a reasonable price (avoid the $39.95 course...that is as worthless as some of the $5,000 courses) and you have to be willing to spend the time to learn the basics. If you do and you apply yourself and use the tools you have been given, you too can succeed, and very profitably.
