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-   -   How do I just buy a house paying back taxes? (https://www.askmehelpdesk.com/showthread.php?t=161621)

  • Dec 11, 2007, 12:22 PM
    Queen 16
    How do I just buy a house paying back taxes?
    How do I just buy a house paying back taxes? What do I do to buy a house for just the back taxes?
  • Dec 11, 2007, 01:57 PM
    AtlantaTaxExpert
    I believe you are talking about tax sales of houses confiscated by the city/county/state to satisfy back taxes owed to the city/county/state.

    It CAN be done, but it is a specialized process that varies from state to state. Further, you will be competing against seasoned pros who do this for a living.

    Your better bet is to buy foreclosed properties. The number of foreclosed properties have skyrocketed in the past six months, and continue to go UP!

    However, you MUST do your homework before you bid on any property, because, BTW, you will only be able to inspect the OUTSIDE of the property.

    The days of buying such properties, quickly fixing them up, then selling them for a profit are, In my opinion, rapidly fading. The process is known as "flipping" a property, and that process has been a contributing factor to BOTH the current credit crunch and the bursting bubble of property values.

    Only those who have a significant amount of cash available to invest will be able to play this game well in the future, and they will have a LARGE number of houses to choose from when they decide it is time to buy.

    If you do NOT have that large cash reserve or you do not have a LOT of time to visit and inspect the properties in question, I recommend you consider some other way to invest your money
  • Dec 11, 2007, 05:03 PM
    Fr_Chuck
    First you don't just pay the back taxes, you will bid on the propoerties at a tax auction. The auction will start at the amount of tax owed. Many times you may be the other bidder and that will be what it sells for.

    Other times there may be 10 bidders and the property sell for somewhere about 25 to 50 percent value of the home.

    Also the problem is viewing the homes, in TN where I lived there would be about 50 properties listed on the first list, but by the time of the sale only 10 or so would actually sell.

    In Atlanta there may be 100's listed to start with, you can't go see all of them basically, and you don't know which ones will or won't sell since normally about 70 to 80 percent of them get paid by the owners or mortgage company prior to the tax sale.

    After you win the bid, then the process varies greatly by state, in some you get a tax ded that day and own it, in others you get a tax certificate which you can redeem in 1 to 3 years for the property. Which gives the prior owners the chance to come back and pay you back for the property , plus interest, which was 10 percent last property I bought.

    Also you have to have cash at the day of sale.

    Also normally there are issues getting liens on these properties for some time. So most sellers of these either sell them on contracts for deed or do so on a quitclaim type deed, never a warranty deed.
  • Dec 12, 2007, 09:14 AM
    AtlantaTaxExpert
    I yield to Fr Chuck's greater esperience and expertise on this issue, which, BTW, should not even BE on this forum.
  • Dec 12, 2007, 09:19 AM
    ScottGem
    Moved to Real Estate as this is not a tax question.

    As Chuck noted, you have to bid on the property at a tax sale. Even then the previous owner will have some time to redeem the property.

    Do you have a specific property in mind?

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