Earn High Interest with Tax Lien Investing
While some real estate investors like to invest in land and hope that the land value will rise over time, other knowledgeable investors choose to invest in tax lien certificates and earn a high interest rate that is guaranteed by state law.
In Colorado, tax lien certificates currently earn 10% per year and are secured by real estate. Many investors have given up on gambling in other investments with wild swings up and down and the risk of market crashes. Banks pay very low interest rates on savings accounts and CDs. But tax lien certificates in Colorado earn 10%, no matter if the economy is in a recession, if other markets are crashing, or if the banks are only paying 1% on CDs. Even if real estate values are flat or falling, you still earn 10% per year.
With tax lien certificates you do not own the real estate. You own a tax lien, which is debt owed by the property owner for unpaid property taxes, with the real estate serving as security. You do not have a right to use the real estate. You have none of the responsibilities or potential problems or risks of owning real estate. Once you do some research to choose and buy a tax lien certificate, it takes no time or expense to deal with real estate, property maintenance, repairs or tenants. You continue to earn 10% per year while you are sleeping, watching TV, on weekends, on vacation, working, in college, retired, disabled or in a nursing home.
Tax lien certificates can be great for younger investors saving for retirement that want to see steady growth and compounding over time. They can be used to build savings for a college fund. They can be great for senior citizens and retirees that want an investment providing peace of mind.
You can invest in tax lien certificates inside a self-directed retirement account such as a traditional IRA, Roth IRA or an education savings account for tax deferred or tax free investing.
In Colorado, property owners that are delinquent on their property taxes have up to 3 years to pay the back taxes. This is known as the redemption period. After 3 years, if the back taxes remain unpaid, the tax lien investor can apply for the deed to the property. The tax lien investor becomes the new owner of the property for pennies on the dollar, by paying any back taxes due and processing fees. This is known as a tax foreclosure.
Once you acquire property by tax foreclosure, you may sell the property, hold it, use it or rent it. If you sell it, you can make a huge profit, even if you sell it for a discount below market value.
We use computer software and models to research and analyze the tax lien certificates and parcels that are available for Wild Horse Mesa, Costilla County, the San Luis Valley, other locations in Colorado, and other states. We can provide information if you are interested in learning how to invest in tax lien certificates earning 10% per year, along with the possibility of buying property for pennies on the dollar.
You can start investing in tax liens with as little as $100, but we suggest that you invest more so that you can build a portfolio of tax liens. Investing in tax deeds requires more money and more research since you are buying a deed to the property.
In addition to Colorado, you can also invest in tax lien certificates in other states including: Alabama, Arizona, Florida, Illinois, Indiana, Iowa, Kentucky, Maryland, Massachusetts, Mississippi, Missouri, Montana, Nebraska, New Jersey, South Carolina, South Dakota, Vermont, Washington D.C., West Virginia, and Wyoming.
Some states sell tax deeds. The tax deed states are Alaska, Arkansas, California, Connecticut, Delaware, Hawaii, Georgia, Idaho, Kansas, Louisiana, Maine, Michigan, Minnesota, Nevada, New Hampshire, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, Tennessee, Texas, Utah, Virginia, Washington and Wisconsin.
Georgia and Texas sell redeemable tax deeds. After you buy a redeemable tax deed, the prior owner may still pay the delinquent taxes, interest and penalties during the redemption period and regain title to the property.
One research study found the following results regarding the redemption rates for various types of property. You can set a goal of either earning interest on a tax lien, or acquiring the deed to the property.
Type of Property Redemption Rate
Single Family Residential 90%
Multi-family Residential 85%
Multi-Purpose Commercial 84%
Single Purpose Commercial 70%
Vacant Land 55%
To get started, purchase the Tax Lien Investing Course below.
The other course shown is for investing in Tax Deeds.
Both are high quality courses for learning how to make money and avoid mistakes when investing in tax liens and tax deeds.
Questions?: Send email to Jerry to get started in tax lien investing today!