Tax foreclosures etc?

[Pappy]

How does it all work when you pay someones taxes on a property that they have defaulted on?

I have a possibilty to grab a few properties based on the owners not paying taxes etc...just curious.

[wvspeedfreak]

Usually they will sell the property auction style on the courthouse steps.

[Pappy]

yeah thats what they do, but what happens afterwards?

[wvspeedfreak]

If you are talking about WV I believe they have a year to buy it back.Give April a call,she is up to date on all that.

[Quad18star]

I'm guessing it's different from state to state , province to province , but like wvspeedfreak said , the owner usually has up to a year to buy it back or come up with the payment .

[gbcap]

once they auction it off to you they still have a year to buy it back? in other words the auction winner can not do anything with it for a year? that don't seem right. i think once it goes to auction then it is a done deal. or atleast that is the way it should be. haha. there are alot of these type houses out there. its crazy how many people default on house payments/taxes.

[NorCalRacer]

It is my understanding that only some states will allow this, I know CA stopped allowing it years ago. But if you pay someone's taxes, either you now have that much interest in their house (lien) or they have to return the money with a non-usurios interest rate. I think if you pay five years of taxes in some states the house is automatically yours (along eith any other liens or encumbrances the property may have). Laws vary from state to state, I wish I remembered more but college seems so long ago:( :blah:

[wvspeedfreak]

Originally posted by gbcap
once they auction it off to you they still have a year to buy it back? in other words the auction winner can not do anything with it for a year? that don't seem right. i think once it goes to auction then it is a done deal. or atleast that is the way it should be. haha. there are alot of these type houses out there. its crazy how many people default on house payments/taxes.

I'm not saying it's right but that's the way it is.

[red2004 TRX450R]

check and see if the house is paid for if not the bank will pay the taxes and take the house.
i have tried to get a home that way and every time the financing bank has ended up with the home.

I know in PA the bank always gets first dibs on tax collections or bank foreclosures. to protect there investment .

I have all but given up on trying to get one!!! I have seen foreclosed homes and a lot of time the owners strip every thing out if them including the kitchen sink and the electoral service box, carpet, bathtubs.

if the bank don't get it lots of times realastate brokers get tipped off and buy the home off the owners for cheep and pay the taxes, then sell it or rent it to them!!!

[250r4life]

its a little different than all that... i know how it is here in AZ, and i imagine it isnt too much differnet in other parts of the country...

people default on their taxes, and thus the government places a tax lien on their property. the government just wants their money, so they allow investors to purchase the tax liens and become the lien holders. the government charges the property owners interest on the lien- where i live it is 16%. the government auctions off the liens to the bidder who is willing to take the least amount of interest on the lien. so, it is one way to gain upto 16% annually on your investment. the thing is you do not know when the liens will be redeemed- could be quick, could take a while... also, you run the risk of the owner declaring bankruptcy, at which time the bankruptcy court will decide if you get your anticipated interest or not...

after 3 years, you can move to foreclose on the property, at which time it is possible that you can become the owner. as previously stated though, this is not all too common that you would actually be able to foreclose on the property and take ownership. it can be a good way to receive better returns than sticking your money in, lets say, a CD. i wouldnt neccessarily go purchasing liens blindly either, as without seeing the property, you can screw yourself over pretty good. it is a good idea to do a little research about the property(ies) that you are considering investing in...