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Investing in Real Estate Tax Lien Certificates

July 25, 2016

Every city/town in Connecticut needs to collect tax revenues in order to provide the public services that we enjoy each and every day. Emergency Services, Park & Recreation and Trash Removal Services are just a few of the amenities that the town you live in will provide using tax revenues.

One type of taxation is a tax on "real property." The owner of a parcel of real property is assessed a dollar amount to pay based on its value. If the owner of the property fails to pay the tax, the amount of the tax delinquency becomes a lien against the property. At that point, the town may decide to collect the delinquent taxes by selling the “Tax Lien Certificate” at public auction.

 

Investing in Tax Lien Certificates and Tax Deeds is a very real way to achieve financial independence. However, many so called “Real estate gurus” peddle this strategy as a get-rich-quick scheme. You’ll find them on those late night infomercials talking about how you can buy houses for $500. Although this is possible, It is HIGHLY UNLIKELY.

 

In order for that type of transaction to happen you have to have a homeowner that owns the property outright (mortgage free). But still can’t pay their tax bill of only $500. Again, it’s possible, but HIGHLY UNLIKELY.

 

If tax lien investing is a strategy that you’re interested in, I encourage you to do your research and get a full understanding before you jump in. Unfortunately I haven’t personally invested in Tax Liens and none of my investor clients do (to my knowledge). I also haven’t found any good educational resources to help you on this journey. If you invest or have invested in Tax Liens, I certainly would like to hear from you. Please click here to contact me. I can help you expand your investment portfolio but even better yet, your knowledge can help others achieve financial freedom!!

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