Oklahoma's New Law Regarding Over The Counter.
Hi All,
I just spoke today with somebody at the treasurer's office regarding over the counter liens. She said they just passed a new law that doesn't allow them anymore to assigned to investors liens sold to the county at the october sale. This must be fairly new since I did buy such liens, over the counter, by mail, 3 weeks ago.
I want to read the text of the new law. Any ideas where I can find it without going to oklahoma (I live in Maryland).
[addsig]
Try:
http://www.findlaw.com
Acab--(MD)---------
A treasurer sent me this note: "Attention: The govenor signed a bill May 3, 2004 to end certificates of assignments."
This will be a bad blow to investors who want certificates or to buy properties through the certificate process.
Things change over time.
Good Investing*****Ron Starr*************
[ Edited by RonaldStarr on Date 05/13/2004 ]
Thanks Nancy and Ron for your prompt replies. That's indeed a bad blow for TLC investors like me. It good news for you though, Ron, because starting in 2005, there will be more good properties for sale at the June resale auction. Properties that would have been stolen through TLC assignment under the previous rules (assignment of TLC by the county).
Here is why I want to know precisely what the new law says. Let's say a property X's TLC was sold to the county in October 2002 for $1,000 (2001 taxes), and I buy, at the October 2004 sale, a TLC for 2003 taxes, also $1,000. What will I have to pay ? $1,000 or $2,000+ through endorsement of prior taxes ? If it's $2,000+, does that in effect assign to me the TLC sold to county in October 2002 ? Does that mean I can start foreclosing right away ? If it's $1,000, does that mean that the county, who own the 2002 TLC, can/will offer the property at the June 2005 resale, therefore making my 2004 TLC pretty much useless ? Understanding this is critical to making decision as to which liens to buy at this upcoming October sale. In one case, an existing 2002 TLC sold to county is a huge advantage (ability to start foreclosing right away). In the other case, an existing 2002 TLC owned by the county will make the 2004 TLC useless as far as having a shot at acquiring the property.
So far, under old rules, whenever I was assigned a TLC by the county, the county made me endorse/pay for all TLCs on the same property sold to the county (not just the year I requested).
I tried to locate the law in www.findlaw.com, but gave up. Ron, do you know which edition of the Journal Record the law was published in ?
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Achab--(MD)----------------
I don't notice the text of laws being printed in the Journal Record legal paper. There is often some discussion of the topic of some bill, but without a lot of detail. However, I never noticed this one mentioned. I haven't had time to read every issue carefully, however. Perhaps it was not important enough to warrant an article.
I did a google on "Oklahoma legislature" and the second or third site was the "Official" site of the legistlature. They have a section devoted to the status of bills. I presume that the text of the bill will be there also. I spent a few minutes trying to locate this bill, but was not successful. I looked under the category of "revenue and taxation," "counties," and I think something else.
There are subject titles for the bills, which are organized by bill number, and I could not find something that looked appropriate, even doing an "edit search for" terms like assignment, certificate, deliquent, etc.
Perhaps a more diligent search will turn up the text.
I would guess that it does not go into effect until the liens are sold at the Oct 2004 tax sales. So, you might be able to buy older liens. You might talk to your treasurer informant about that.
Not all treasurers know the law well. One wrote me a note that the tax resale deed is given to the bidder to record. That used to be the law. About three years ago the state law changed, with the treasurer required to take the deed to the clerk's office for recording.
Good Investing***********Ron Starr**********
[ Edited by RonaldStarr on Date 05/13/2004 ]
[quote]
On 2004-05-13 08:35, RonaldStarr wrote:
Achab--(MD)----------------
I would guess that it does not go into effect until the liens are sold at the Oct 2004 tax sales. So, you might be able to buy older liens. You might talk to your treasurer informant about that.
Good Investing***********Ron Starr**********
Hi Ron,
The new law already went into effect. I have been sending to the Treasurer's office requests to buy liens over the counter since February of this year. I did get liens assigned to me late March and mid April. I called them 2 days ago (May 11) to find out the status of the requests for which I didn't receive any response. That's when I was told about the new law, that they will no longer be assigning liens, and that my only opportunity to buy liens is now the October sale. And that the county will keep the liens it acquires in October until redemption or the June resale 2 and half years later.
[addsig]
I read with some interest a lot of the comments from readers on this board about tax lien investing. However, I would like to point out a few errors stated by many earlier. There are states which sell tax liens, and then there are many states which sell tax deeds, where the states hold onto the tax liens themselves and then foreclose on the properties themselves after nonpayment of real estate taxes after a number of years, and then sell the properties free and clear at the end, usually netting more cash at the end for themselves. Washington, Oregon, and many of the Western States are tax deed states. A few states sell redeemable tax deeds, which look and walk and talk like tax liens, but are in fact tax deeds, but the owners have a redemption period within which time they can still redeem the tax deeds and get their properties back, similar to tax liens. These three states are Texas, Tennessee and Georgia, which pay penalties of 25% and 6 months redemption period, 10% interest rate and 1 year redemption period, and 20% penalty and 1 year redemption period with a need for filing a foreclosure of right of redemption at the end of the 1 year prior to actually getting actual ownership of the property, respectively. New York has some counties that sell tax liens, but not all of them do. Maryland sells tax liens but has a very strange bidding system that you must research carefully and fully understand before diving into. Arizona and Florida, which have high starting bid in interest rates normally wind up selling decent tax liens are horribly low interest rates to the winning bidder. In Florida, last year and presumably this year, most of them will go for 0.25%!!! Think that is a good investment still? Good luck!! However, I still find good places to buy myself. After reading John Lane's books on tax liens in http://www.taxsalelists.com and going to his seminars and applying his methods, I now own 21 properties that cost me around $100,000 in investments in tax liens and legal and title costs total. I hope to sell them for over $1 million soon in various states. So there IS money to be made here, so good luck!
Rich N--(NC)-----------------
I think it is good that you have clarified things for some people.
One thing: in the deed states it is often the case that the excess proceeds of the sale belong to the former owner and people holding obligations secured by the real property sold at tax sale. That is, after the taxes are paid, any amount bid above that is excess proceeds, and people can get that money back. So the governmental entities do not profit from the higher prices.
Sometimes there is no claim for the excess proceeds. Here in CA, that means that the taxing entities do get to share in the extra money.
By mentioning several states in one sentence, some people might be a little confused about things. You are right that in Texas one gets a deed burdened by a right of redemption. Talking about foreclosure, however, might make people think that they have to foreclose out the right of redemption in Texas. In Texas that is not so, the right of redemption automatically disappears after either 6 months or two years, depending upon the type of property, so there is no need to do a foreclosure. I'm sure you knew this, I just worry that less knowledgeable people might be confused because of the mention of foreclosing.
Since every state has different laws about the collection of delinquent property taxes, I think it is incumbant upon anybody who is planning to invest in tax liens or buy properties at tax sales to study the laws for the state in which he/she/it is investing.
Good Investing************Ron Sta00************rr
Ron,
You are absolutely right about Texas. The foreclosure of right of redemption is only needed in the redeemable tax deed state of Georgia. It is also not necessary in Tenessee where unfortunately the interest rate is only 10% and it is NOT a penalty either, which means you earn a portion of the 10% depending on the length of time before you are redeemed by the owner, and as in most tax deed states, the properties are usually in very poor state of disrepair. Good luck!!
RC from NC who is still waiting for results of OTC lien purchases from
Okmulgee County, Oklahoma to come in, so I guess I can pretty much forget it now!
Hi All,
I am going to answer a question that I, myself, asked a couple of months ago. About how long you have to wait if you buy a tax lien in October 2004 in Oklahoma, and the county makes you endorse the lien they themselves acquired 2 years ago. I just talked today to somebody from the Treasurer's office who seemed to know what she is talking about, and she told me you still have to wait 2 more years in that situation before foreclosing.
That sux. No more opportunity to buy a lien in Oklahoma and start foreclosing right away like in the good old days.
[addsig]
Adenour----------------
I feel you are absolutely right. That wipes out a great way to invest in a tax lien state.
Sigh. Well, those of us who are expeienced will just find other ways to make money with tax sales and tax liens.
Good Investing************Ron Starr*************