How to Invest in Real Estate Deeds

When property taxes are not paid on real estate property the government places a tax lien on the property. A tax lien is the amount owed on the real estate taxes auctioned for a return in interest rate. After a designated time, the purchaser of the tax lien is able to file for a tax deed and collect the amount made by the sell in the auction.

Real Estate Deeds can be a great way to invest your money. What is the best way to go about it? 

1. Research is imperative. Real estate deeds are owned by counties and each one has a variation on the general law for acquiring the tax deeds. In order to fully understand the process you will want to search on the Internet or read books about the process for your particular area, or the area where you have found the land you would like to own.


2. Contact the Tax Collector or Treasurers Office in the county that owns property you would like to invest in. Be ready with questions to ask such as:

• Is there a tax sale coming up? 


• Where will it take place?


• Where is the list of tax liens/properties to be auctioned and how may I require a copy?


• What are the terms and conditions of the sale?


• What is the interest rate applied to properties and how is it calculated?


• Do you have unsold property from previous sales?

On the last question, if the answer is yes you will want to know where to obtain that list. Remember that sometimes one county will not have any properties available. But, do not give up because the next county may have a huge amount to choose from. After you have the list, you will use it to:

1. Identify where the property is, the owners name, the assessed value, the size of the property, and to find out whether or not it has been improved in any way.


2. Attend some of the auctions to research how your local area handles the sales.


3. Narrow down the list with attention to the following; location, whether you would prefer to deal with property that needs improvements or property that is ready to resell and the amount you are prepared to invest.