Your Due Diligence, In Conclusion...

Reach Out to Other Investors

A great way to practice due diligence is to reach out to other investors and networking. Tax lien investing has become a fairly well-known investing adventure for the ‘common’ folk. Resources abound on the web including blogs, ezines, and discussion boards.

If you have a question about a particular state or county that you are interested in investing in, don’t be afraid to ask “experts” and other investors. They can be your greatest, experienced resource.

It is best to research your state and county laws and procedures yourself. This is accomplished best by either calling the state/county entity or subscribing to a trustworthy website that researches all of this key information. However, sometimes there are minor details that only a seasoned investor may know. ASK SOMEONE!

An informed, knowledgeable investor is a successful investor. We all had to start somewhere and most investors are willing to share their knowledge.

Our website has a great, open discussion board that already has discussions ranging from state specific questions to others about over-the-counter liens. ( http://tax-lien-database.com/blogselect.aspx ) Stay tuned to this blog and don’t be afraid to ask questions and expect quality answers!

No matter what type of investment you put your hard-earned money into, you would always make sure you understand before you jump in. Tax liens and tax deeds aren’t any different. Gain knowledge from those before you and don’t be afraid to gulp your pride and make sure you fully understand before making the leap.

Happy Investing!

©Rachel Seidensticker is an administrator for the comprehensive database http://www.tax-lien-database.com. For more information on tax liens or gain access to the dynamic, updated information regarding tax liens and tax deeds, visit the website and become a member.

Your Due DIligence, Continued...

Don't Invest Without Investigating!

There are several ways to practice your due diligence when investing in tax liens/deeds. As stated in the previous blog, it is important to know your state and county laws, contact local agents, and proceed with caution if using investments agents. I want to look further into investigating! The biggest step to your due diligence is knowing the property that you are investing in and what type of lien you are buying.

Even if you are only investing in tax liens, you still have the potential of OWNING that property one day, so it is crucial that you invest your hard earned money that will make a return on your investment.

Investigate, investigate, investigate…

Once you have a thorough understanding of the laws surrounding your county that you are investing in, it’s time to track down the SALE LIST! From this list, you can obtain a tax i.d. number (usually a geocode) that can be used to search county property records. Most county property records are now available online. It is considered public information, so if it isn’t online, you can call or visit your local treasurer’s office to retrieve this information. These property records will give you the address of the property that you may want to invest in. This is where either contact with a local real estate agent comes in handy or more investigating on the internet on your own.

1. Find out neighborhood information by searching other property in the area that is for sale to see its potential market value (usually available on real estate agency websites)

2. Google Earth the location to see a glimpse of the area.

3. Check out a local newspaper to find out more about the town or certain section of a town.

All of these simple facts and steps safeguard your investment.

Tax sale lists are available through the county entity holding the auctions, local newspapers, or even more convenient, on our website. Our website has all the information you need to practice your due diligence including property record websites.

These lists are your connection to protect your hard-earned money! Don’t ever invest in anything with a blind eye! Get out the spy glasses and become an investigator.

Practicing Your Due Diligence

Interested investors are coming out of the wood work to try their hands at tax liens/deeds. However, since this form of investing is starting to become well-known and popular, there are more and more inherent risks, including scam artists. There are several steps an investor can take to heed caution and protect his/her hard-earned money.

1. Know the state and county laws

Every state varies in their laws governing tax liens/deeds. The first and foremost pertinent information would be finding out if a state uses a tax lien, a tax deed, a redeemable deed, or any combination thereof, because they are all very different processes.

The laws governing tax liens/deeds determine when, where, and how a sale is held in each county. Most states require the tax lien sale lists to be published in a newspaper 3-4 weeks in advance. This is important information to know because before you purchase a lien, you will want to know what is available for purchase.

Other laws include the redemption period for the tax lien/deed. These vary as well between 2-4 years. This, too, is important since as an investor you will want to know how long you will be receiving your return as well as when you may potentially foreclose on the property for ultimate ownership.

Overall, to practice your due diligence, the first step is to understand the laws governing that state’s tax liens/deeds. Although there are varying differences, most states have a similar overall procedure. It’s the minor details that can catch you off-guard and leave you dangling with no investment to speak of.

2. Investigate the lien and the property it is against

Another step to your due diligence is to simply become an investigator. The first step is to find out what type of tax lien is held against the property and of course how much it is for. This is simply stated in the tax list itself or found in assessors’ site, treasurers’ sites, or other public records sites. By gaining access to the lists from the county entity, newspaper, or online database, you will find extremely important information in helping find out more about the property itself and the lien against it. It’s crucial to weigh all the factors surrounding the property and the lien including the amount to know if it is a worthy investment.

a. Seek service from a real estate agent

A great resource to find out about the property that the lien or deed is against is through a local real estate agent. Once you have the address of the potential investment property, which can be found using the tax id number on the tax sale list, a real estate agent can be of great service. Have him/her search the location of that property and what its market is doing. Once you know a property’s market value including the neighborhood and services available in that area, you will be able to make the best, informed decision about whether or not to invest in that property. Whether or not it would be a good rental, easy to flip (fix up and sell), or possibly live in, it is important to know everything you can about the property!

3. Hire an attorney who specializes in tax liens/deeds

If you obtain or plan to obtain a tax lien, it is important to seek the legal advice of an attorney who specializes in tax liens/deeds in order to safely invest your money. They will guide you through the process of eventual foreclosure if the property owner never pays off the lien. There will be significant paperwork involved and although most county entities will assist you, they cannot give legal advice and will only help so far.

4. Hire an investment agent to work for you

If you are a large investor or uncomfortable practicing your own due diligence, a good resource is an investment agent. However, BE WARE! As stated above, scam artists are out there and this is a big area of caution. Again, practice your due diligence by looking up the agent and their credentials including a Better Business Bureau search or contacting past clients to find out about their experiences.