Tax Lien Sale In October - First Time And I Have Questions
I'm in Oklahoma and they have Tax lien sales once a year in October. I've never done this before and just started reading up on it in the last week, but I'd like to give it a try. I have some questions and would like to get some input if possible. I'm sure I'll come up with more questions, but right now, this is what I have.
1. After purchasing a tax lien on a property, does the redemption period start after the tax lien purchase or sometime prior to that?
2. Who pays taxes on the property while it is waiting to be redeemed or go to deed? If I have purchased the tax lien, am I responsible for any follow up taxes if it is not redeemed?
3. Can there be more than one tax lien sold on a property? I’m asking because Oklahoma has a 2 year redemption period, so would it go up for sale after the first year and again after the second?
4. Oklahoma has a tax lien sale once a year so how can I tell if a property is close to being at the 2 year mark, or are they normally sold close to their redemption date?
5. Do I need to fill out a W-9 before I purchase a tax lien?
6. Should I purchase in my own name or come up with a business name to buy these? I’ll need to apply to the state for a legal business if that’s the case.
7. Oklahoma’s redemption rate is 8% per year. Not great by any stretch, but is the 8% charged on the delinquent taxes or the property value?
8. How do I find out if there are any other liens on the property I'm interested in?
OK also has a Resale Auction of county owned property in June. I may lean toward bidding there, but I'm attending the tax lien auction regardless of purchasing anything. I was also told, that the county will sell property whenever the County Assessor feels they need to do it. That could be difficult to keep up with, but there could be a good deal because of that.
Thanks for your help.
Here we go...
(1) You must hold the tax certificate for two years before you will be issued a tax deed.
(2) Yes. If the property is not redeemed you own subject to all other taxes etc.
(3) There can be many liens on the property, including fed. tax liens, state tax liens, and city liens for weeds, etc.
(4) Get the list from the County treasurer and it shows the tax year that the lien was placed on.
(5) Talk to your accountant.
(6) I don't see any benefit to organizing just for one tax sale. You don't own property, only the right to collect the taxes if it is redeemed.
(7) 8% of the amount on the face of the tax certificate, which is the same as taxes owed.
(8) Once you have the list of properties, get thee to the County Clerk and check the filings for each property that you are interested in.
Hope that helped, good luck.
Also note, that in OK, properties not purchased on the date of the tax lien sales, can be purchase Over The Counter. This means you can own the property outright without waiting through the redemption period. Approximately 9 months of the year, these liens may be bought over the counter in 77 county treasurer's offices. You can then Immediately start the process for a deed. The 9 month period begins about the 2nd week in Aug and goes through about the 2nd week of May the following year.
Hope this helps!
Jenny
Good point. The properties do have to go through at least two years before they can be purchased from the county. The treasurer's website says they are usually sold after 2 1/2 years. Thanks for pointing that out.