Buying Tax Foreclosures

Virtually every state offers tax deed sales. These are sales of repo homes which are repossessed in order to pay for unpaid property taxes. All homeowners must pay property taxes on their property. Homeowners who do not pay this tax may have their homes repossessed by their county. The county will then resell the foreclosed properties to the public in order to recoup the money the county has lost through unpaid property taxes.

The exciting thing about tax lien sales is that the properties sold to repay property taxes are sold for the amount of unpaid taxes and the amount of any additional fees the county has incurred on the property. Since taxes amount to only a small amount of a home's value, it is possible to buy tax sale foreclosures for a tiny percent of a home's actual worth. This can mean amazing savings of many tens of thousands of dollars.

Tax sales are also an opportunity to buy real estate for very little because the properties sold this way are sold to the highest bidder. If there is not much interest in a property, you could pay very little indeed. Laws dictate that a tax sale must be announced publicly, so these sales are usually announced through notices in local newspapers. Sometimes, this can attract investors who may be willing to try to outbid you. Whoever bids the highest price on a tax sale property buys the deed to the property, free and clear of any liens or loans.

Like any real estate auction, tax sales do carry risks. Homes purchased this way are sold with no warranties, which means that you are fully responsible for any problems with the property. You will want to carefully research a property and have it inspected if possible before arriving at a sale to place your bid. Just because a foreclosure is offered at auction that does not mean it is a bargain. The more informed you are when you arrive at the auction, the more prepared you will be to make an informed decision.

You can contact your local county office or scour newspaper listings for tax deed sales in your area. If you are not comfortable with auctions yet, you can get comparable savings on thousands of foreclosures available online at ForeclosedPropertiesData.com. Our listings are updated each day and contain detailed information so that you can understand what you are buying.