FUN and PROFITS in 

TAX FORFEITED 

LANDS

NEWSLETTER


 

NEWSLETTER –
COURTESY OF TAX RESEARCH FOUNDATION

DISCLAIMER

The following information is designed to provide accurate and authoritative information in regards to the subject matter covered. It is distributed with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional services. If legal advice or other expert assistance is required, the services of a competent professional person should be sough.  (From a declaration of principles jointly adopted by a Committee of the American Bar Association and a Committee of Publishers and Associations.)
 
 

MOTIVATIONS FOR THIS WEEK

 GOALS
EIGHTY PER CENT OF SUCCESS IS SHOWING UP.
-----------------------------------------------
"When you are sure you are on the right road to success
you don't have to plan your journey too far ahead.
Don't burden yourself with doubts and fears
as to the obstacles that may bar your progress.

You don't need to know all your answers in advance.
Just have a clear idea of the goal you want to reach.
You can only take one step at a time.

If you can muster up the courage to begin,
you'll find the courage to succeed.
It's the job you never start that always takes the longest to finish.

Go after what you want and you'll get it."


 

FUN AND PROFITS IN TAX FORFEITED LANDS


 

254 GOLD MINES IN TEXAS

That is correct. There are 254 counties in the state of Texas and each one of them is a Gold Mine if you know how to mine them.

Texas is a so-called Tax Deed State similar to California, Oregon, Washington, New Mexico, Kansas, Arkansas, and several other states.

However, there is one big difference in Texas. It is also similar to a tax lien certificate type of state but with a major difference that can produce astronomical profits.

Here is how it works in Texas. Most of the counties in Texas have at least one tax forfeited land sale each year where property delinquent for non-payment of taxes is sold to the public at auction to the highest and best bidder. Many of the larger populated counties have a sale on the first Tuesday of each month.

The successful bidder receives a deed to the property and is entitled to possession and rents from the property. However, the former owner has six months to redeem property if the property is not designated as agricultural or homestead exempt. The redemption period is 2 years from the date of the recording of the deed on agricultural and homestead exempted property.

If and when the former owner redeems during the fist year he must pay the purchaser the total amount he paid at the auction, the recording fee, and any additional or subsequent taxes paid PLUS a penalty of 25%. If the property carries only a six-month redemption period here is an example of how you would gain.

Let's assume you paid $5,000 at the tax sale, you incurred a $10.00 fee for recording the deed, and you paid additional taxes not included in the foreclosure suit of $1,000.00. You have invested $6,100.00. If the former owner wants to redeem he must pay you the $6,100 plus 25% ($1,525.00). This must be paid to you even if redeemed on the very next day after the sale. This guarantee you an annualized yield of a minimum of 50%. That annualized yield can be much higher if redeemed only after one or two months. In addition to this fantastic yield, you are entitled to rent out the property during the time that you own it. This could easily provide you with an additional profit prior to the property being redeemed.

But, what happens if it is not redeemed? You have hit the jackpot. You now own the property outright. You probably have purchased a property for 10% of its fair market value or less.

If the property is homestead exempt or agricultural exempt you still win in a big way. Yes, the redemption period is two years. But, wait just one minute. If it is homestead exempt it means that the former owner is occupying the property unless it has been abandoned. What you do is a writ of possession just as soon as you record your deed. By the way, every single deed I have ever received as a result of a tax sale in Texas states that "A writ of Possession will issue out of this Court." The judge has already order the clerk of the District Court to issue a wit of possession if you apply for it. The costs in normally $8.00. This is then turned over to the Sheriff or a Constable who is ordered by the court to put you in peaceable possession of the property. I will just bet you that the homestead exempt owner living in the property will beg, borrow, or steal to redeem the property and he will do it quickly. He is faced with a certain eviction and the time is very short. The Sheriff or Constable will normally give them a few days to move out. If they do not move out in the time specified by the Sheriff, the Sheriff will physically evict them and put their personal property in a local storage rental business. You now have possession of the property.

Chances are good that if you will offer the former owner a few hundred dollars for moving expenses he will give you a quit claim deed to the property which completely makes the two year redemption period mute.

If he redeems, it is normally within a very short period after he is served with the writ of possession. You receive an extremely high rate of return on your investment.

BUT THIS IS NOT ALL -

There are other profit making techniques that can be utilized in Texas.

When property is not sold at the tax foreclosure sale the ownership transfers to the taxing jurisdiction which initiated the foreclosure proceedings. This property is commonly referred to in Texas as "Struck Off" property. It is either struck off to the County, The Independent School, District, the City, or in some cases the POA (Property Owner's Association). Most counties have several Independent School Districts located within their boundaries which now own these types of properties but do not want to own them. Independent School Districts are tax-exempt and the property does not accrue taxes while owned by the County, City, or ISD (Independent School District).

Here is the opportunity. You can obtain a list of these struck off properties form the County Tax Collector in the case of county owned "Struck-Off " properties or from the Independent School Districts in the case of properties "struck off" in their names. Our 84 page Fun and Profits in Tax Forfeited Lands manual for Texas has the mailing addresses of all 254 County Tax Collectors in a comma delimited. It has the names and addresses of most of the Independent School Districts in Texas also in a comma delimited file. In addition we have added the names and addresses of most of the law firms that are hired by the various counties to conduct their Tax Foreclosures. All of these can be imported into your favorite database and can be mail merged using the mail merge tools on your word processor.

This huge Texas manual also contains form letters not only for your use in writing to the Proper Public Officials, the Attorneys, the School Districts; but also suggested form letters for writing to the delinquent property owners.

BUT THIS IS NOT ALL - THERE IS STILL MORE GOLD IN THESE TEXAS COUNTIES!!!

Many real estate investors are involved in what they refer to as "flipping." This means that they find potential buyers for rehab type properties then acquire those properties and sell them to their pre-qualified buyers for a few thousand dollars instant profit with little or no out of pocket money by the real estate "flipper." Here is what they do.

On weekends and in their spare time they map out a territory. They drive around looking for homes that appear to be in a bad state of repair, vacant, or otherwise possible candidates for their pre-qualified "re-hab" buyers. They then contact the owners of these properties by phone of by letter and attempt to buy the property or at least obtain an option to buy it at 50% or less of its fair market value. They do quite well for themselves. One lady in the Dallas area says she has done over 80 such flips in the last two and one-half years. If she made a profit of only $4,000 each on these properties you can easily see how well she has done.

I have what I consider a better technique of finding "flippers" that involves a lot less work. Here is the technique.

Visit or write to the Clerk of the District Court in the counties that you would like to use this technique. Ask for a list of all Tax Foreclosure Cases which have been docketed (filed) during the last 12 months. All you need are the case numbers. These are cases where the attorney representing the taxing jurisdiction has actually filed a foreclosure action against the delinquent property owner. Just ask for a list of the case numbers to start with. There may be a small charge but it is a lot easier than driving around taking notes on possible "rehabs" for a day or two. You will be amazed at how many cases have been filed. They will number in the hundreds in even average populated areas. They will be in the thousands in counties such as Bexar (San Antonio), Dallas County, and Harris County.

Here is what you do next. After you receive a list of the Tax Case Numbers you then write back and request a photo copy of the first page of the complaint form. The normal charge for a copy of this one page is $1.00. That page will furnish you with the name and address of the defendant(s) and a legal description of the property. Now, all you have to do is prepare your mailing list, create your form letter to write these delinquent property owners and offer to get them out of their situation by buying their property for a token payment or at no more than 30% to 40% of its assessed value.

You can start working your Texas Gold Mines even if you live in a distant state. What you need is our $79.00 manual which can be ordered at http://www.taxsales.com. You then can start your research project to prospect for Gold in the county(is) of your choice in this very exciting business in this State of Texas filled with Gold Mines full of potential profits.

I bet you will make a lot more money then the real gold prospectors of old and new. Let me have some success stories from you.

  Texas  also has a redemption period but you can use that to your advantage.
See Texas Auctions Below.

Many think of Florida as being only a tax lien certificate sale state.  The fact is that most Florida counties have one or more tax deed sale auctions each month.  These public auctions are judicial foreclosure sales of tax lien certificates by the holder of a tax lien certificate whether it is a person or the county.  These auctions provide some tremendous profit opportunities.   Contact the clerk of the District Court of each county for  the auction information.  It is their responsibility to conduct the auctions.
 

NOTE:  When you come up with other creative ideas; AND YOUR WILLING, to share them with the rest of us.  You can post them at roys@wt.net

I hope this helps making your investing more enjoyable and more profitable.

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