If you have been considering home flipping as a viable investment option in this current economic market, you may be surprised to learn that this is still an alive and functioning investment opportunity for many flippers who have deep enough pockets to run their flips in a business manner. Many of the hardcore flippers have managed to keep their money flowing by looking at other ways to invest their money for guaranteed returns or getting property for a steal with enough time and patience. Buying property across the United States through a government sanctioned tax sale is a great way to invest money and get a guaranteed return if you know what you are doing. It's also a great way to expand a home flipping business and fortify you against a tough economic housing market.
Start by learning about the different types of tax sales in your state so you understand what you're bidding on and what you can expect to walk away with. The two different types of sales include tax lien and tax deed sales.
In a tax lien sale you are bidding on the tax debt to pay the county the money that it is owed. You are essentially just paying the back owed taxes that the property owners have failed to pay. This may work well for the county - they don't have the tax debt anymore, the back taxes are caught up and the property owner is not in danger of being kicked out of the home. So what's in it for you? Good question. This type of tax sale is a gamble that you can't really lose. The property owner has a set amount of time to pay you the back taxes plus interest on your loan or they lose the property to you and you get the home for the cost of taxes.
If the property owners manage to repay you the back owed taxes, you don't get the property but you make a profit on the interest rate that is charged and in the meantime you have some pretty decent tax sheltering going on.
The second type of tax sale is a tax deed sale, and as the name implies, you are getting full ownership and possession rights of the property from the county. This can allow you to buy property for a fraction of the value if you are a savvy buyer and make a great return on your future home flip.
Before you begin looking at the tax sale rolls as a means to fortify your home flipping business, make sure you do your research so you understand the different types of sales and you understand how each one will affect your bottom dollar as an investor.
If you take the time to do the research you can move forward with this concept as a solid investment opportunity to advance your business, even in a sour economy.
If you intend to go to a Tax Sale, educate yourself first at http://www.civicsource.com.
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