Learn How To Buy A House By Just Paying The Taxes

Summary

In this video, Ted Thomas, a tax lien certificate and tax deed authority, explains how you can buy properties at significantly reduced prices by paying delinquent property taxes. He outlines the process of purchasing such properties through county auctions, emphasizing the importance of thorough research, understanding legal implications, and checking property conditions before bidding. Ted also shares success stories of people who have profited from this strategy, while cautioning about potential pitfalls, such as remaining liens and poor neighborhood conditions.

Takeaways

• 🏠 You can buy a house by just paying property taxes, which is legal in all U.S. counties.
• 💼 If property taxes are not paid, the county may place a tax lien, followed by a levy, and eventually auction the property to recover the owed taxes.
• 💲 Properties can be purchased at auction for just the amount of delinquent taxes, sometimes for less than $500.
• 🌍 This opportunity exists in all states, with examples of properties being bought for a fraction of their value, such as in Los Angeles County.
• ⚠️ While mortgages and deeds of trust can be wiped out at tax auctions, other liens like IRS or municipal liens may remain on the property.
• 📊 Researching and identifying profitable properties requires examining the neighborhood, property condition, and title records.
• 🛠️ Buyers should be cautious of buying properties without physically inspecting them and understanding potential defects or title issues.
• 🚨 Attending auctions in person and conducting thorough due diligence is crucial, as there are no refunds once a property is purchased.
• 📈 The goal of this investment strategy is to buy low and sell high, with margins potentially leading to significant profits.
• 🗺️ Ted Thomas offers a tool called the 'magic map,' which helps users find tax auctions nationwide and identify potential properties.

Q & A

What is the primary concept discussed in the video?

The video discusses the concept of buying properties through tax lien certificates and tax deed auctions, where properties can be acquired by paying the delinquent property taxes owed.

Why do counties auction properties with delinquent taxes?

Counties auction properties with delinquent taxes because they need the tax revenue to fund essential services like schools, police, fire departments, and county employees. The auction helps the county recover the owed taxes.

What types of properties can be bought at tax auctions?

At tax auctions, various types of properties can be bought, ranging from small homes to large colonial houses. Some properties may be in good condition, while others might be neglected and require repairs.

Can mortgages and deeds of trust be wiped out during a tax auction?

Yes, mortgages and deeds of trust can be wiped out during a tax auction. However, other liens like IRS liens or municipal liens may remain on the property.

What should potential buyers do before purchasing a property at a tax auction?

Potential buyers should conduct thorough research, including checking the property’s condition, title defects, and the neighborhood. It’s advisable to have professional help from attorneys or financial experts to navigate the complexities of liens and other legalities.

What are some common mistakes people make when buying properties at tax auctions?

Common mistakes include buying properties without physically inspecting them, not checking for title defects, and purchasing properties in bad neighborhoods. Additionally, relying solely on online information without doing due diligence is risky.

What is the significance of doing homework before participating in a tax auction?

Doing homework is crucial because it helps buyers understand the property’s value, condition, and any potential legal issues. Proper research ensures that buyers make informed decisions and avoid costly mistakes.

What happens if the property purchased at a tax auction has defects or issues after the sale?

If a property purchased at a tax auction has defects or issues after the sale, the buyer is responsible for them. There are no refunds from the county, so it’s essential to conduct thorough research before bidding.

How can someone find out where and when tax auctions are happening?

People can find out about tax auctions by using resources like the 'magic map,' which provides information on auctions across different counties in the United States. The map helps identify auctions by state and county.

What is the potential profit margin in buying properties at tax auctions?

The potential profit margin in buying properties at tax auctions can be significant. For example, a student mentioned in the video bought a property for $9,100 and sold it for over $100,000 after making necessary improvements.