Purchasing Tax Deeds and Tax Liens


nevaehinvesting said:
If you can get them before the tax sale, it's sometimes better. In Houston (3rd Ward) I sent about 100 letters to people with delinquent property taxes (vacant houses) and got about 10 responses.

Of the 10, I got 6 deals from the homeowners. Houses had taxes, and small liens, but no mortgages. On average, I paid 5K for owed taxes and gave 2K spending money to the owner. I resold each to investors for 20K. Deals took no more than 1 month each.

The owners could have easily done the same thing...:quiet:
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I prefer doing it this way also.

Contact delinquent property tax homeowners directly. I usually look for vacant homes in good condition. I usually remodel or renovate the houses myself. If done right, this method is very profitable.
 
nevaehinvesting said:
Here's one way to do it in Houston (Harris County):

Step 1. Drive neighborhoods with vacant houses (Houston has a lot of these) & record the addresses. Try to get 75-100.

Step 2. Research the taxes owed at hcad.org (look up by address and clip on the 'taxes' link.

Step 3. For properties with 3yrs+ delinquent taxes make a list of the owner's current address & the amount they owe in taxes.

Step 4. Try to get their number and call or just mail them a letter (as an area developer) telling them the house is in bad condition, it has delinquent taxes, and can be eventually taken and sold at auction if THEY don't do something. Tell them you will pay their taxes, their liens, & give them "several thousand dollars spending cash", & buy the house.

*Pull low comps in the neighborhood to justify a low offer to the owner. When you get ready to sell, you'll of course pull high comps.

Last, if they're interested, negotiate and get it under contract. Immediately send the contract to your title company for a title search. Add up the taxes, the liens, and what you're paying the seller and that you're real purchase price, (X).

If Flipping: Find an investor who wants to rehab it and flip it to him for X profit. (have 5-10 investors ready always) Sign another contract with your investor for (X + your profit) and send that contract to the title company also. Tell them you're doing a "double closing". Close with the original owner at 10am, and close with your investor at 10:30am the same day. You keep the difference in contract prices.

If Keeping: Fix it up, refi cash-out, and section 8 it.

6 or 7 or 8 of these per year can make you $100K. Of course, there are factors and variables specific to each deal.
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Cool, Thanks. I started my list last weekend in Acres Homes, lots of vacants there.

Also, what about the houses that go up for auction and doesn't get bid on. What do they do with thoses?
 

ThrowForSix said:
Cool, Thanks. I started my list last weekend in Acres Homes, lots of vacants there.

Also, what about the houses that go up for auction and doesn't get bid on. What do they do with thoses?
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I believe the state keeps them if nobody bids on them. At least they do here.
 
Actually, yes! I'm in a deal right now. I brought a 3bd/2bth/2CarGarage. It had fire damage, but was a great deal. Has lots of equity and I'm in the process of rehabbing it. I hope to be finish in a month or so.

There are so many good deals out there it is crazy!
 
ThrowForSix said:
Actually, yes! I'm in a deal right now. I brought a 3bd/2bth/2CarGarage. It had fire damage, but was a great deal. Has lots of equity and I'm in the process of rehabbing it. I hope to be finish in a month or so.

There are so many good deals out there it is crazy!
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Congrats. I had one with fire damage once. Keep me posted. I'm not as into it as I used to be but I know a little bit and have associates doing it full time so ask questions if you need to. Congrats again.
 
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