Key Takeaways
- Tax lien certificates earn statutory interest rates of 8-36% depending on the state.
- The majority of tax liens are redeemed by the property owner; foreclosure on unredeemed liens is the exception.
- Tax deed auctions sell the property directly, but "as-is" with no inspection rights or condition warranties.
- Foreclosure auction properties can trade at 30-60% below retail but require cash and accept significant risk.
- Systematic due diligence (title research, exterior inspection, value analysis) is essential for all auction strategies.
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Test Your Knowledge
1.In tax lien states, what happens when a property owner fails to redeem a tax lien certificate within the statutory period?
2.What is the key difference between tax lien states and tax deed states?
3.Why is a quiet title action typically necessary after a tax deed purchase?