Is Buying Tax Lien Certificates Good For your Health - August 30, 2007
I recently saw a television program advertising tax lien certificates as a way to get higher interest rates. They made the area of investing in property tax liens appear very lucrative, and fairly easy to get into.
As I have some experience in this area, it's not as easy and stress free as they make out on the TV – and definitely not good for your health if you can't handle a lot of stress and anxiety that goes with it.
So here's my take on it…
Purchasing tax lien certificates is not for the amateur. It is a complicated process and will vary from jurisdiction to jurisdiction. Let me outline my past experience with this. A community, after attempting to collect real-estate taxes, would have a tax lien certificate sale, whereby you would pay the taxes on the property to be secured by that lien. A reverse auction would be held; for example, I might say 12 percent and you would underbid at 11 percent, 10 percent and so forth, even down to negative numbers.
What's more, in certain states you have to get tax liens for three consecutive years. If someone else bought it for two years and you managed to get the third, you would be obliged to negotiate with the other person, because without all three liens you could not foreclose.
In addition, there is the matter of existing mortgages, which could present some difficulties depending on the laws of the jurisdiction and the person who is first in line.
In short, most of the get-rich pitches on television infomercials (and tax lien investment pitches like this one) will likely only make you poorer. If you wish to pursue this, spend some time in the nearest library researching what is involved.
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Looking after your health is one of the most important things you can (and should) do. But with so much information it's hard to know where to start or who to listen to. Hopefully by sharing my experiences and knowledge, I'll make the path to improving and protecting your health a lot easier to follow.
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