Seven Tips On Buying At Tax Foreclosure Sales

Seven Tips On Buying At Tax Foreclosure Sales

Several things should be considered before you place a bid at tax foreclosure sales. You should know as much as possible about the circumstances surrounding the foreclosed property.

Tips and advice

Tip 1. There are two types of foreclosed property tax sales: a tax lien sale and a tax deed sale. It is crucial you know which type of foreclosure property you are bidding on as they are very different from each other.

At tax lien sales, the county government responsible for collecting taxes on the property sells the tax lien itself that the homebuyer hasn?t paid. The winning bidder is actually paying the tax debt on the property. The homebuyer must then pay the bidder back, at a higher rate of interest than normally allowed, or face the final prospect of foreclosure from the person who paid the tax debt.

At a tax deed sale, the county government is selling the entire property and rights to possession go to the winning bidder.

Tip 2. Many places are available to search for information on tax foreclosure sales that have attracted your interest. Web sites can offer invaluable assistance in finding out details about the foreclosure property. Foreclosed properties are made a part of the public record; much information is available if you know where to look.

Tip 3. You can visit with the County Clerk?s office in the county where the property is located. They keep a record book called, "Registry of Impending Foreclosure Sales". Again, you want to find as much information out about the property and its history as you possibly can.

Tip 4. You need to know whether the property has been vacated or not. If the occupants are still living there, it is often difficult, costly, and time-consuming to get them to vacate the premises.

Tip 5. Make a site visit to the tax foreclosure property you are interested in. You want to know as much about the condition of the property as possible. If you are able to get a look at the interior of the property, which is not always possible, you might want to hire an Inspector to go with you and assess the state of the property.

Tip 6. If you are the winning bidder, you must pay in cash, or with a cashier's check, in full, ordinarily by the end of that business day. In some instances, you might be able to qualify for a loan at the auction site if there are lending institutions present to assist you.

Tip 7. Homebuyers can pay the taxes anytime up to the day before the auction, in most cases. If the taxes are paid, you will no longer be able to bid on the tax foreclosure, no matter how much research you may have invested in it.

Know the laws governing a sale

You should have a good working knowledge of the laws, rules, and regulations governing tax foreclosure sales before you purchase. The procedures can vary from state to state, and county to county. Once you find a property you are interested in, stay on top of what is going on with it, as changes could alter your mind as to its purchase.

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