Everyone seems to be running scared from real estate right now however I will a how you a no lose way to not only make a guaranteed profit but potentially end up with houses for little money.
In today’s economy many people cannot afford their homes which causes many problems. They are late on their mortgage payments, ultilities and in the end their real estate taxes. When you buy a tax lien you are not only helping a struggling family get back on their fee but getting a potential house in return.
The way these liens work is that when a homeowner falls behind on their county, city, or school taxes, a lien is placed on their home. The homeowner cannot sell their home until it is paid off and if the lien is not paid within the local laws time limits, the house gets sold by the tax department to pay off the taxes or a investor buys the tax lien and must be paid back by the homeowner.
If the homeowner whom is struggling financially can pay back the investor the back taxes with interest, than the lien is paid in full. However, if they cannot afford to pay back the investor then the investor gets the home.
Since many homeowners owe more than the house is worth or cannot afford the mortgage payment they simply walk away from the home. This leaves a tax lien holder with the home which has plenty of equity to sell or keep the home to rent to someone else.
So the tax lien investor has one of two things happen.
1. They get paid back their tax lien investment with large interest.
or
2. They get the house since the homeowner did not pay the tax lien off.
There are more details to this system including how and where to buy them, etc. but this is how the big picture looks and can get you a home for less than $2,000.
