Winning a tax lien at auction is just the beginning of the investment process. What happens next depends on whether the property owner redeems the lien or fails to pay within the required time frame.
Once you’ve purchased a tax lien, you’ll receive a tax lien certificate, which grants you the right to collect the delinquent taxes, plus interest, from the property owner. If the owner pays within the redemption period, you’ll receive your initial investment back along with the interest earned.
If the property owner does not redeem the lien before the redemption period expires, you may have the right to initiate foreclosure and take ownership of the property. This process varies by state and may require legal filings and additional costs.
To stay on top of your investment, regularly check the county’s records for updates on payments and deadlines. Some investors prefer tax liens for their interest earnings, while others strategically pursue liens with the intent of acquiring properties. Either way, understanding the next steps ensures that you maximize your investment.
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.
