If you're unfamiliar with the concept of the delinquent tax sale, you might be missing out on a tremendous opportunity to buy a home for far less than its actual value. These properties are put up for auction when the owners fail to keep up with their property taxes. Typically, this is a cash sale that comes up once a year in nearly every county in the country. There are a number of advantages to participating as a buyer. For one, you are cutting out the middle man and buying straight from the county. This expedites the process and keeps you from going through escrow. Secondly, it is an amazing opportunity to make an investment that can turn into a real cash cow.
Your first step will be to contact your county courthouse and ask for the date of the next delinquent tax sale. After you have this information, ask them where you can get all the information you need. In many cases, a pamphlet will be available. It will detail the properties that will be up for auction and may even provide a map to help prospective bidders visit the homes before the date of the sale. You may have to pay for the materials, but it should not cost more than about $ 10. For that price, it is a valuable tool.
Do not take out a loan and show up to the auction ready to bid on properties without having seen them yourself. This is a big mistake and it can easily result in getting stuck with a home that you would not be able to sell even for auction prices. There are often some very nice finds at a delinquent tax sale. But let's face it: 90% of the properties are going to be in some state of disrepair. The millionaires in your city's nicest neighborhoods are not going to suddenly forget to pay their taxes. Do not let this discourage you! There are still some gems out there. But you must visit each property you have even the slightest interest in bidding on.
You can not wait until you've placed a successful bid at a delinquent tax sale to go and find the funding you need to complete the transaction. Most counties are going to expect payment by the next day at the very latest. If you place a winning bid and can not come up with the money immediately, they are just going to sell it to the next guy in line. You may not be welcome to return next year. Make sure you get whatever loans you need in advance.