When buying any of the government owned properties which are listed on The Deed XChange™ the purchase price changes daily because the County by law must pay interest to the tax lien certificate holder(s). Understand that time is of the essence. These properties will sell, so you must learn to do your due diligence quickly but carefully. Use the guidance provided in this post to get you started. Leave comments on other strategies as well.
You must contact the County Representative found in the listing to get the actual pay-off. It is important to note that each County uses a different process and has a different processing time. Before contacting them, please read this guidance on Working With Government Officials.
Generally the County Representative will provide you with a purchase price in writing, which is good for several days or weeks. They also will give you guidance about the payment process. This can range from coming to their office to pay and receive the deed the same day all the way to you executing an ACH bank draft and getting the tax deed sent to you weeks later.
During this waiting period complete your final due diligence before purchasing the property. The steps below will help guide you through this process.
IMPORTANT NOTE: Be prepared to spend some money to complete your due diligence. Of course you should always try to do as much as possible at no or low cost. However, do not be so cheap that you don’t pay a professional $100 or less, to give you information you need to make thousands, or that will help you avoid a costly mistake. If you are struggling to invest the funds needed for due diligence, then seek first a money partner. More on that in another post.
BEFORE YOU BUY:
- Contact the County Representative listed by telephone.
- Please be professional and let them know you found the listing on The Deed XChange™ and that you need the current payoff to buy the tax deed on the property.
- Be prepared to provide the parcel number or address provided which in the listing
- Next you need to determine what if any liens will survive the tax deed sale.
- Verify all liens against the property before buying!
- Contact Pro Title Services and order a full foreclosure title report
- When you receive your title report, call them back and ask them to explain to you EXACTLY which of the liens listed you will be responsible for satisfying. Naturally you will need to add these into your acquisition cost.
- Confirm the after repaired value. This should be the price you can sell it for quickly, that is IF selling is your exit plan (more on exit strategies soon).
- TIP: Start with Zillow and contact one of the many real estate agents listed in the sidebar that specialize in that area. Interview them looking for one that works with investors and has experience selling the type of property you are looking to purchase in the exact market area.
- Be honest and tell them what you are doing and that you need them to provide:
- A detailed market analysis
- What else is for sale that is similar to the one you are considering
- Ask if they have access to 2-3 licensed general contractors as well
- NOTE: If you are buying land/lots or any property for less than $20,000 there’s not much commission opportunity for the agents. So they may or may not want to spend much time with you. I’ll be providing strategies about working with real estate agents in a future post.
- If there is a building on the property, get a detailed property analysis report!
- Contact Mueller Reports toll free at 1-855-627-9660
- If you are buying land or a lot get a current picture.
- There are several options:
- Ask the real estate agent you contacted.
- Get a photographer in the zip code from Fiverr.com
- Look on the local Craigslist for a service provider
- Contact us
- There are several options:
- Check the FEMA website to see if the property is in a flood zone
- If you have not already, lined up your financing, contact one of our preferred lenders or find a money partner
- At this point (2-3 days from the start) you should have a good idea if you are going to move forward with the purchase.
- Contact LegalZoom to get professional legal and financial advice.
- You must determine the best way for you to take title of the property.
- You are now ready to purchase!
- Work your plan to exit and take your profits!
REPEAT THE PROCESS ON THE NEXT DEAL!
Wishing you much success!