The first time you click “bid” at a tax lien auction, your heart races. Your palms sweat. You second-guess everything.
That's normal. But it doesn't have to paralyze you.
The difference between nervous beginners who freeze and confident investors who win? Preparation, a clear plan, and knowing your limits before the auction starts.
Step 1: Do Your Homework Until It's Boring
Confidence comes from knowing you've done the work. Before you bid, research until you could teach someone else about that property.
Your pre-auction checklist:
- Pull the property record card (most counties post these online).
- Check Google Street View and satellite images.
- Verify lien amount vs. property value (aim for <50% or less).
- Confirm redemption rates for that county (look for 70%+).
- Read the auction rules twice.
Example: ‘Sarah’ spent three weeks researching her first county. She watched two auctions without bidding, just to see how they moved. When she finally bid, she won a $6,200 lien that redeemed in 11 months at 12%. She wasn't lucky. She was ready.
Step 2: Set Your Limits in Stone
The biggest mistake first-time bidders make? They decide their max bid in the heat of the moment.
Write down your limits before logging in:
- Max bid per lien: $______
- Max total deployment today: $______
- Walk-away rule: “If bidding goes above ___% of property value, I'm out.”
Stick to it. No exceptions. Auction adrenaline will convince you to overpay if you let it.
Step 3: Start Small and Build Momentum
You don't need to win big on your first try. You need to prove the process works.
Start with one or two smaller liens in counties with high redemption rates. Think $200-$500 range. Low risk, real returns, real experience.
Once you see your first redemption check, the fear disappears. You're not a beginner anymore. You're an investor with a track record.
Step 4: Everyone Started Where You Are
Every six-figure tax lien investor had a first auction where they had no idea what they were doing. The only difference? They placed the bid anyway.
You don't need to know everything. You just need to know enough to make one smart decision.
Your Action Plan
Before your next auction:
- Research three liens completely. Pick one to bid on.
- Write your max bid on a sticky note.
- Watch one full auction without bidding to see how it flows.
- Place your first bid with money you're comfortable tying up for 12-18 months.
Confidence isn't about feeling fearless. It's about being prepared enough to act despite the fear.
This blog is for informational purposes only and should not be relied upon as financial or investment advice. Real estate investing carries risks, and individual results will vary. Always consult with your team of professionals before making investment decisions. The authors and distributors of this material are not liable for any losses or damages that may occur as a result of relying on this information.
