Florida Tax Cert Investing
I have some questions regarding investing in Florida Tax Certs.
1. If I buy the cert over the counter (after the auction) what is the interest rate? (is it 18%/year)
2. What happens if the deed holder files for bankruptcy? Do I loose my investment? Is it frozen until the bankruptcy court rules? Will I automatically be notified of the bankruptcy filing or must I track the financial status (bankrupt, solvent) of the deed holder?
3. If i file for tax deed auction, and submit the winning bid what happens to other lien holders such as mortgage holders (liens), mechanics liens, etc.? Do I assume any of the properties existing liens (other than property taxes)? What about federal tax liens?
4. Is it advisable to buy certs that are low cost $100 to $1,000 or big ones $3,000 to $15,000? ie. is the strategy to buy lots of little ones predicated on the quick minimum return of 5% within weeks of the auction?
thanks
[addsig]
One note on small liens--FL has a law that states if the cert is under $100 AND is on a homestead, then it is NOT available for sale until the total amount owed reaches $100.
I am in Florida and it really depends on the county. There are large lien certs that you can buy OTC. They will be pretty much on vacant lots but now if Florida you can do a lot better sometimes on vacant lots.
The market here in FL ir redhot for lots and such so even lots in mostly unpopulated areas are going for $13000 or more. Some lots I got last year for $2500 each are now at $45-$70K.
The thing is to research, research, research.
ruuururturu
IRS can redeem you out. And you still have to serve them as a party of interest/lienholder. Make sure you serve them appropriately - Mr Roberto Gonzalez, etc.
[ Edited by TaxHit on Date 03/11/2006 ]