| Most people have not heard of tax lien | | | | you won't have to wait a whole year to earn |
| investing. Yet there are millions of people | | | | your 15% interest. If the property owner pays |
| across the country earning safe, secure, and | | | | off their taxes in one month, you'll still |
| most importantly, high percentage interest | | | | earn that same 15% interest, but you'll get |
| returns by investing in tax lien | | | | it one months time. Freeing up your money to |
| certificates. To put it simply, investing in | | | | invest again. Lets say you take that money, |
| tax liens is an easy, high profit way to | | | | and each month invest in a tax lien |
| invest in real estate, without needing large | | | | certificate and get paid off right away. |
| sums of money to do it.So what are tax lien | | | | That's 15% interest, 12 times, giving you a |
| certificates?Each year property taxes are due | | | | final return of 180% over the period of the |
| on all properties. The local government uses | | | | whole year. Because interest rates are always |
| the money from property taxes to pay for | | | | calculated over the period of one year, this |
| various things in the community. If an owner | | | | is what's called your effective return on |
| doesn't pay their property taxes, the | | | | investment. This is why investors love tax |
| government still needs that money to be able | | | | lien investing. In a state like Texas your |
| to run their county effectively! So what's a | | | | effective return on investment can be up to |
| government to do? They levy a tax lien | | | | 300%!Examining the alternativesHere are some |
| against that property and auction it off at a | | | | alternative investing options that the |
| tax lien sale. An investor, YOU, will | | | | majority of americans invest in. Included |
| purchase that tax lien with the understanding | | | | with them is an average interest rate and the |
| that you will earn a certain percentage | | | | degree of safety of the investment.Savings |
| interest rate. When the owner of the property | | | | account - 1% - safe |
| finally pays off their taxes(plus penalty | | | | |
| fees), the county then cuts a check to the | | | | Money market - 1-2% - safe |
| investor for the principle amount invested, | | | | |
| plus any interest or penalty fees accrued. | | | | CDs - 1-4% - safe(interest rate depends on |
| The county makes out because they get the | | | | length of CD |
| money they need to run things, the home owner | | | | |
| or business makes out because they are given | | | | Stock market - average growth 11% - unsafe, |
| more time to pay off their taxes, and the | | | | percentages vary wildly from year to year |
| investor makes out because they just earned a | | | | |
| lot of money without really doing much at | | | | Tax lien certificates - 5%-300% - Safe. |
| all!Why should I invest in tax lien | | | | Government run. Enforced by state law. Fixed |
| certificates?SafetyTax liens are sanctioned | | | | interest rates.The ultimate win/win |
| and run by the government. Your investment is | | | | situationSo what happens if the owner doesn't |
| protected by state law and secured by actual | | | | pay off their taxes? Well in many states you |
| real estate! What other kind of investment | | | | would initiate a foreclosure on the property. |
| option provides that kind of backing? Take a | | | | The property gets auctioned off at a tax deed |
| look at it from the other end. People do NOT | | | | sale, and as the tax lien certificate holder, |
| want to lose their homes. So odds are they'll | | | | you get paid off first. But in other states |
| pay off their taxes, thus paying you off. And | | | | the property is signed over to you free and |
| if they don't...you just may end up with a | | | | clear! That's right, your small investment |
| free property.Minimal CompetitionThe great | | | | geared to earn 15% just earned you a free |
| thing about tax lien investing is that, for | | | | house with which you can do as you please. |
| the most part, it's a completly unknown | | | | Live in it, rent it out, sell it, whatever |
| investing option. Most people think that | | | | you want.ConclusionSo why should you invest |
| stocks, bonds, mutual funds, CDs, money | | | | in tax lien certificates? Because it simply |
| markets, and traditional real estate | | | | doesn't make sense not to. If you'd like to |
| investing are the only ways to invest their | | | | learn more about the ins and outs of tax lien |
| money. So what you have is a very small | | | | certificates or specifically about tax lien |
| number of people "in the know" making tons of | | | | auctions, more detailed information is |
| money in an extremely low risk form of | | | | available.Gregory Nirshberg owns and operates |
| investing.High Return on InvestmentYour | | | | Tax Lien Investing Resource. A website |
| return on investment will vary largely | | | | dedicated to providing free quality |
| depending on what state and county you are | | | | information about tax lien certificates and |
| in. But to give you a rough idea, interest | | | | the tax lien investing process.With analysis |
| rates will vary from about 5% to 25%. Now, | | | | of tax lien auctions, tax deed sales, and |
| given how safe and easy this is, these kind | | | | even tax lien investing tips for the |
| of interest rates alone would be worth the | | | | newcomer. |
| investment. But there's more. In most cases | | | | |