TAX SALE CERTIFICATES |
When a property owner does not pay their taxes, there is always a grace period, or
a Redemption Period, as it is commonly known, when they have a chance to pay
the back taxes due, plus penalties and interest. Some statews wait until this Redemption
Period has expired and the delinquent property owner has exhausted every
legal opportunity to pay up. Then they foreclose, seize the property and sell
it at public auction to the highest bidder. Other states don't want to wait until the Redemption Period expires. They want their tax money now, so they issue tax certificates, for the amount of the taxes due, plus penalties and interest. Investors then bid on these certificates at a public auction and either bid up the price of the tax certificate, or bid down the interest rate that the delinquent taxpayer must pay to rdeem their property and pay off the tax certificate. If the tax certificate is not paid off by the end of the Redemption Period then the investor has the right to either automatically foreclose and seize the property or to go to court and petition for the right to foreclose and seize the property, but ideally, the investor just gets paid off, with interest, before the redemption Period expires and it remains a passive investment. TAX SALE RICHES HOME PAGE |