Show Posts
1
Member Experiences / General Question
« on: July 19, 2006, 05:08:56 PM »
I have known of tax sales for some time now but I have always been nervous to dive in. I think that I am very close to dipping my foot in the water but I am still very cautious.
I have read about the general process of tendering bids etc. but I'd like to get more information on what truly represents good due dilligence as it relates to tax sales.
As I imagine it - you collect whatever information you can from the municipality - probably visit the property to decide if it something you're at all interested in. After this point it gets fuzzy. There are two searches you should do -a title search against the property and two a search against the current owners. I understand that this can be hired out so I don't have to be an expert - but what specifically I am looking to find with these searches. Or maybe more accurately, what are the red flags that typically indicate that this is going to be a difficult one.
Also, assuming, the searches check out and I make a bid - the minimum bid represents the outstanding taxes as I understand. Beyond the price bid - what are the additional charges / expenses associated with closing the sale? I am trying to understand what kinda of additional capital I will need beyond the sucessful minimum bid.
Lastly, do you take on the debt obligations of the current owners? Or is the propoerty yours free and clear? Once you've purchased a property do the previous owners have any claim to the land? Can they redeem and leave you out in the cold? If they can - what happens with the money you put up to purchase the property?
If anyone can help - I'd greatly appreciate it. I'd like to step off the ledge but I am still very apprehensive.
I have read about the general process of tendering bids etc. but I'd like to get more information on what truly represents good due dilligence as it relates to tax sales.
As I imagine it - you collect whatever information you can from the municipality - probably visit the property to decide if it something you're at all interested in. After this point it gets fuzzy. There are two searches you should do -a title search against the property and two a search against the current owners. I understand that this can be hired out so I don't have to be an expert - but what specifically I am looking to find with these searches. Or maybe more accurately, what are the red flags that typically indicate that this is going to be a difficult one.
Also, assuming, the searches check out and I make a bid - the minimum bid represents the outstanding taxes as I understand. Beyond the price bid - what are the additional charges / expenses associated with closing the sale? I am trying to understand what kinda of additional capital I will need beyond the sucessful minimum bid.
Lastly, do you take on the debt obligations of the current owners? Or is the propoerty yours free and clear? Once you've purchased a property do the previous owners have any claim to the land? Can they redeem and leave you out in the cold? If they can - what happens with the money you put up to purchase the property?
If anyone can help - I'd greatly appreciate it. I'd like to step off the ledge but I am still very apprehensive.