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Government Tax Foreclosures and Benefits of Tax Liens

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By : Fiona Livnat    99 or more times read
A sale of tax liens is conducted by an agency of the government for defaulted taxes on real estate properties. It is one of the methods of collecting delinquent taxes, while the other is tax deed sales. These are measures of government tax foreclosures.

At Tax sales, a property can be bought for a small percentage of its market value. The other alternative is that you can collect a high interest rate of 18-19% when the lien is paid off. Either way, tax sales offer highly profitable investments.

In order to compensate for income lost from delinquent tax payers, the county governments organize tax sales in the form of public auctions. In fact, when you are purchasing a deed or a lien at a tax sale, you are paying up the taxes on the part of the defaulted homeowner.

As a return, you get the principal paid for the lien and also any interest that has accumulated after the defaulting tax payer becomes current on his taxes. Plus, an added benefit is that if late taxes are not paid by a specified date you can foreclose and get the title of the property.

In a tax lien sale, the government of the county will sell its tax lien on the property at an auction where investors are allowed to bid for the debt. In a tax deed sale, the county government will sell full ownership rights to the property. Both are safe and profitable avenues for investment. It is vital to know the rules and regulations of each type of sales as they differ from county to county.

All home owners are required to pay property taxes. If they do not the government is obligated to place tax liens against the sale of the property leading to government tax foreclosures. At this stage real estate investors step in and try to purchase the property from the home owner. The property may have accrued a large amount of tax liens. The investors may pay off the taxes and become proud owners of a valuable piece of property.

There are tax liens that can be obtained through tax liens certificates and various other methods of government tax foreclosures. Investors need to research all the various methods, view court tax records and zero into properties that may interest them.

Investing in properties that have tax liens against them maybe as simple as walking up to and paying back taxes at the county courthouse. By these methods of government tax foreclosures, the title of the property may be transferred to the investor. Some other tax liens may deal with by other methods like the investor contacting the home owner directly. Some tax liens may involve extensive paper work.

These are some of the ways in which government tax foreclosures are disposed off.
Fiona Livnat is an author with expertise in real estate foreclosures. She has over ten years of experience in writing about government tax foreclosures. Her commitment to help people is reflected in her writing. For more details please visit

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