When dealing in Tax Delinquent Real Estate you will invariably have to work with the counties and their employees and officials on an ongoing basis.

Here are few things to take into consideration when dealing with the county officials.

1. County officials are elected and therefore are politicians. They work for their constituency and not for you (although officially they should)
2. County employees are government employees and are not rewarded for their creativity and “go get it done” attitude, but instead are working for their retirement benefits.

Having made the above two statements, I have usually a GREAT relationship with county employees and officials.

But you need to understand where they are coming from. County employees are usually in positions where there is no way for them to advance into a higher position. They are Case workers or customer service personnel and the supervisor (if there is one) is usually already in his/her position for many years or the immediate supervisor is the elected official him/herself. Therefore since there is nowhere to go and the work they do is pretty much the same year in, year out, they tend to be the kind of individuals who work to pay the bills and for the benefits. Life in their point of view is being lived after work and on the weekends.

That is fine but it kind of goes against what you want to accomplish when you get there. You want help, assistance, questions answered, paperwork processed, etc. and all of the above in the fastest possible time. That is a dilemma.

However in my experience there are ways to get stuff done fast. One thing County officials and employees do cherish (like any other human being) is praise and a good honest thank you. So whenever you deal with the county personnel make sure you thank them, and if someone did something out of the ordinary which they did not have to do for you, and then send them a little card or a box of chocolate. This is not a bribe; it is just an honest thank you. Since you know what position county workers are in you all can have a higher level of appreciation if they actually do something faster and more efficient than what the official duty calls for. I have learned over time that a thank you note or a box of chocolate goes WAYS. One time I sent a little card out just because that person in the county really bent over backwards for us to make some things happen in a couple of days that otherwise would have taken weeks to accomplish. Over one year I did not need to be again in contact with that department and surely I did not even think about that card anymore. But when I then after more than a year contacted that same lady again, she immediately remembered me, and thanked me for the card. She even mentioned that nobody had ever sent her a card thanking her for her services, and guess what, whatever I needed to be done was done in lightning speed with a smile on her (and my) face. Needless to say I made sure to thank her again explicitly and even mentioned it to her boss.

In today’s article I want to talk about Goal setting, one of the most neglected exercises in the world.

If I were to ask you where you want to be professionally, personally and financially in 5 years from now, would you be able to have an answer ready.

Statistics have shown that well over 90% of Americans (and that is the same in other counties too) do not have written goals.

As a matter of fact there was a study being done with Graduates from one of the Ivy Schools like Harvard or Yale. They asked all graduates if they had written goals. Only 3% of these Graduates had such written goals. Then they checked up on these same graduates 20 years later and found something fascinating. Most graduates had done well and had good jobs… but what they found was that the 3% with the written goal controlled more than 90% of the cumulative wealth of the entire group and also reported to be the happiest, satisfied with their lives.

This alone should make it clear how important written goals are. Or to ask this in more simple words, How do you know when you arrive if you don’t know where you are going? How do you even know which direction you should go and if the direction you are currently going is the right one?

So sit down write down goals for 3 months, 6 months, 1 year, 5 years, 10 years and 20 years. Be aware that chances are that your 5, 10 and 20 year goals will look completely different once you get there, but you have to start somewhere and start going towards something. You can always adjust down the road and as a matter of fact you should and must do that on a regular basis (like 2 times a year).

Twice a year, once at the beginning and once during your summer vacation, look at your goals and decide if you need to make some adjustments either to your goals or to the path you are currently taking towards them. Then make any adjustments and keep going.

You will be amazed of how fast you reach some goals and how you are reaching out for goals you have almost forgotten you had. Things just start happening which bring you towards these goals and all of a sudden, the next time you look at your list of goals you realize that a bunch of them are realized without you even noticing.

In recent years the prospects of earning high interest rates of up to 16, 18, or even 24% through investing in Tax Lien Certificates has started to attract professional investors and even some mutual funds.

Therefore competition for Tax Liens is increasing. But the determined individual investor still does not need to give up and can instead use some creative techniques to still get the number of Tax Lien Certificates desired.

First it needs to be mentioned that the above said institutional and professional investors mainly attend Tax Lien Auctions in metropolitan areas, where values of properties and therefore the average Face Value of a Tax Lien Certificate tends to be quite high ($1,000 and up). This makes sense for them because they don’t want to mess with TLCs for $100, $200…

Therefore they show up with several people to one auction so that they have a higher chance that their bid becomes the winning bid in case of a draw of bidders.

Therefore here are some tricks you can when attending a live Tax Lien Auction to still get your Tax Lien Certificates.

1. Go look for Online Only Tax Lien Certificates. True, competition is not less there but at least the playing field is level and everyone has the same chances.
2. If you already want to go to a live auction, bring some friends and have them register too. Give them EXACT and DETAILED instructions on what they are allowed to bid on and up to (or better) down to what interest rate.
3. Of possible pick a county that has some good valuable property but is not a metropolitan area. If the county is more rural than populated, the institutional investors might not show up or in less numbers.
4. Sit up front and center or if this is not possible sit close to an isle. After all the Auctioneer and his auctioneering assistants are the ones who declare the winning bidders so you want to sit somewhere where they can see you well.
5. If you live in an area where winter storms are common and there is a winter storm or heavy rain on Auction day, make it a point to GO ANYWAY. Because many bidders are only semi-serious so if the weather is bad, they might just decide to stay at home. If you do the extra step and still go, you can get the good deals.

As they say “there is never much traffic on the extra mile”

In recent years the prospects of investing in Tax Deed Auctions has started to attract professional investors.

Therefore competition for Tax Deeds particularly in metropolitan areas can sometimes be steep. But if you are a determined individual investor you don’t need to give up and instead can use some of the below creative techniques to still get the Property you set out to purchase.

First it needs to be mentioned that the above said institutional and professional investors mainly attend Tax Deed Auctions in metropolitan areas, where values of properties tends to be quite high and properties tend to move quicker, thus enabling the investors to quick flips. This makes sense for them because they don’t want to mess with Properties worth $5,000 to $30,000 in rural areas which using traditional sales methods might take a few months to sell.

Therefore here are some tricks you can when attending a live Tax Deed Auction to still get your Properties.

1. Go look for Live Tax Deed Auctions. Competition is higher in online auctions because it is so convenient to attend them from the comfort of your home. So if you focus on the ones which do not happen online you have a better chance of winning.
2. Of possible pick a county that has some good valuable property but is not a metropolitan area. If the county is more rural than populated, the institutional investors might not show up or in less numbers.
3. Sit up front and center or if this is not possible sit close to an isle. After all the Auctioneer and his auctioneering assistants are the ones who declare the winning bidders so you want to sit somewhere where they can see you well.
4. If you live in an area where winter storms are common and there is a winter storm or heavy rain on Auction day, make it a point to GO ANYWAY. Because many bidders are only semi-serious so if the weather is bad, they might just decide to stay at home. If you do the extra step and still go, you can get the good deals.

As they say “there is never much traffic on the extra mile”

In the US if a property owner does not pay his property taxes the government will take that property away from him either through a Tax Lien Sale and subsequent foreclosure of the lien or through a Tax Deed Sale.

Tax Lien Sales are a common way in many states for counties to get their Property Tax Dollars released to them. And it is a great way for Investors to earn an excellent interest rate on their investment backed by the Government and valuable real estate worth many times their investment. And the investor has the chance to actually own the underlying property for only the back taxes of a few years plus some foreclosure cost.

How do Tax Lien Sales work:

About 4 weeks prior to a scheduled auction by law the county (or in some cases the state) needs to publish a list in one newspaper of common circulation of all properties scheduled to come up for auction. Nowadays this list is usually also available online for free.

Anyone can obtain the list by either going online to the county webpage, or by getting a copy of that day’s edition of that newspaper, or by asking the county for a copy of the list in form of CD (for which there is usually a small fee of a few dollars).

The public now has 4 weeks to do the proper research on these properties and decide which one to bid on.

In order to bid, the bidder needs to usually fill out a form and get a bidder number. Some counties require this to happen a few days in advance but some allow you to do this on auction day.

In many cases also proof of funds needs to be submitted on auction day or a few days in advance however since the Dollar amounts dealt with in Tax Lien sales are less than in the Tax Deed Auction world, the cash requirements are usually much lower. .

Once you are registered for the auction you will receive a bidder card and a bidder number and then you are allowed to bid. Please make sure to call the county of your choice prior to such an auction to make sure you know what you need to bring.

Tax Lien Auctions have one specialty in that the bidding often is not on the actual dollar amount of the Tax Lien Certificate (although there are auctions that work like that) but instead the bidding is on the Interest rate and in addition the bidding goes backwards meaning downwards.

For Example: If a Tax Lien for $1000 comes up for auction in a state where the highest interest rate is 16%, the auctioneer will start the bidding at 16% and if there are more than one bidder, he will proceed to lower the interest rate to 15%, then 14%…. until there is only one bidder left or until the interest rate reaches 0%.

So basically the Tax Liens are auctioned off to the bidder who is willing to accept the lowest interest rate for their investment.

At the end of the day or once you are done bidding and have declared the winning bidder on one or many properties you go to the cashier’s, pay the amount of the Tax Lien Certificate and then will receive a Tax Lien Certificate from the county (usually by mail within a few days).

Then you wait until the owner either redeems the Tax Lien Certificate and you get your investment back plus the high interest rate or you purchase the subsequent years of back taxes (once they are delinquent) and wait until the Redemption period is over and start foreclosure on the property.

Either way you will get your money back plus a very high return which in the case of you getting the actual property can be in the 500% to 1000% range. But even 16-24% for just interest is not bad at all considering that this is one of the safest investments the US market has to offer.

In the US if a property owner does not pay his property taxes the government will take that property away from him either through a Tax Lien Sale and subsequent foreclosure of the lien or through a Tax Deed Sale.

Tax Deed Sales are a common way in many states for counties to get their Property Tax Dollars released to them. And it is a great way for Investors to get a property with a huge discount (sometimes as much as 60-80% below market value).

How do Tax Deed Sales work:

About 4 weeks prior to a scheduled auction by law the county (or in some cases the state) needs to publish a list in one newspaper of common circulation of all properties scheduled to come up for auction. Nowadays this list is usually also available online for free.

Anyone can obtain the list by either going online to the county webpage, or by getting a copy of that day’s edition of that newspaper, or by asking the county for a copy of the list in form of CD (for which there is usually a small fee of a few dollars).

The public now has 4 weeks to do the proper research on these properties and decide which one to bid on.

In order to bid, the bidder needs to usually fill out a form and get a bidder number. Some counties require this to happen a few days in advance but some allow you to do this on auction day.

In many cases also proof of funds needs to be submitted on auction day or a few days in advance. Requirements vary by county but it is not uncommon to have the county require all bidders to bring at least $2500 in cash or cashier’s check (or money order) and submit them to the county prior to auction. If the bidder does not win any property then the monies are refunded promptly by the county.

But then again in some other counties you just need to show upon registration that you have the cash with you and then you are allowed to bid. Please make sure to call the county of your choice prior to such an auction to make sure you know what you need to bring.

Once registered you receive a Bidder card with a number on it which you use to bid on any parcel you would like to.

Once the auction begins it works pretty much like any other auction. The bidding usually starts at the amount being owed in taxes (and fees and penalties) to the county and goes up from there.

The highest bidder wins and receives within a few weeks a “Treasurer’s Deed” or a “Sherriff’s Deed” from the respective county department.

Now the winning bidder is the new official owner of that property and can take possession of such property or proceed to sell it or do whatever he wants with it.

As you buy properties using my three techniques of you will need to determine whether you want to sell them for CASH only or for TERMS, meaning with a loan which you carry back. Ideally you will find that you want to do a combination of both techniques.

But before I get into the sales portion of this here is a refresher on my three methods to buy properties for pennies on the dollar:

1. Tax Lien Sales, where you buy a Tax Lien on properties unlikely to be redeemed and then foreclose on the lien once the state statues allow you to.

2. Tax Deeds Sales, you buy a property outright at Tax Deed Sale.

3. My favorite method: My personal Direct Investment Method, where you buy tax delinquent properties directly from the often long time owners for pennies on the dollar outside of the auctions and sometimes years before these properties come up for auction.

Once you have the properties you are probably looking to sell them so you can actually realize the profits you have made when buying.

In order to optimize your Cash Flow and put it on Auto Pilot here are some guidelines:

Take the properties you paid more than usual for and sell them for cash. You want to get your capital right back plus some and then reinvest that amount.

Cheap properties on the contrary, where the spread between purchase price and Sale price is LARGE are IDEAL candidates for Term sales, because you might recover your purchase price with the down payment alone or with the down payment and a few monthly payments and then the rest is profits.

Do a combination of both transaction types, Cash sales and Term Sales to get cash in and build up

Take some HIGH VALUE properties for which you only paid 20%-30% of market value and sell them for CASH (no financing). This should bring you multiple of your investment in CASH.

Then take that what you initially invested and buy another one of those high profit properties.

Take what’s left over and buy a lot of smaller lower value properties which you can literally pick up at a few hundred dollars each and sell for a few thousand each ON TERMS WITH FINANCING and a low down payment (of a few hundred dollars).

And then enjoy receiving checks in the mail, first one then a few and soon enough you can scale this to have dozens and even hundreds of checks coming your way each month on property you owe nothing on and which you sell for a multiple of what it is worth.

If you have a property which you bought through one of the three ways of buying Tax Delinquent properties I am teaching, then you probably have only paid 5-10% of the true market value of that property.

Now it is time to realize the profits on that property and one hidden way often overlooked it to Donate the property to a qualified Charity. I am not an Attorney or a CPA, so this is Not meant as absolute advise but only as something that could spark your interests but requires checking and verification with a CPA and/or Attorney.

If you are able to purchase a property for a few hundred dollars that is assessed for a few thousand dollars you might be able to donate this property to a charity and you might get a tax deduction based on the TRUE Market value of the property and NOT based on the amount you paid for the property, thus bringing you a nice profit at tax time.

NOTE: In the tax law there are different ways to donate. Again I am not an attorney but it is my understanding that you CAN write off the full MARKET VALUE of your taxes IF you donate the piece of land not just to any charity but to a charity which operates a lot with Real Estate. Just like you see in the newspaper articles about “donate your vehicle”… these are charities which specialize in that, and thus if you find a charity (non for profit) in your area which for example specializes in “LAND protection and nature preservation” you might be able to write of 100% of your land value. If instead you just donate to your local “save a Hamster” charity, which has nothing to do with Real estate and Land, you will only be able to write off the amount YOU PAID for the land. As always laws constantly change so please make sure you check on this with your attorney of choice so you do the right thing.

Have you ever heard these infomercials advertising that you can buy properties worth tens of thousands of dollars for as little as $100?

The difference between you and me is that you probably did not believe these claims and I did.

So back in 1999 I bought one of these manuals on how to buy Tax Delinquent Properties for as little as $100.00 and guess what, it did not really work but it also did kind of work. So I stuck to it and changed it, improved it and made it better year after year until finally in 2002 I figured out all the missing pieces and had a system that works like a charm and allows anyone to buy properties for as little as $100.00.

Since 2002 I have now personally done over 5000 Real Estate Trasnactions. I have literally bought and sold, not as an agent for other people, but as a principal in each transaction over 5,000 properties and made money consistently in good markets, great markets and in bad markets.

So how does it work. Well back then I was told to send people who own properties a letter just asking them if they would give the property to me for a token payment of let’s say $50.00. You can imagine how well that worked. Of course it did not or almost not work.

However, as I said above, I also kind of worked. I realized that most people who did respond to my letter had one thing in common. They owed property taxes and had decided to let their property go for taxes.

Hmmmm, I thought, so what if I could find these people in masses, and target my letters to them and offer them a little more than $50.00 but not much more? And that is what I set out to do.

Now I have a simple step by step system which allows you to massively increase the odds that one of the people you identify as a target for a mailing campaign is in deed one of the Fed-up Long time property owners who have decided to let their property go for taxes.

Now it is not a crap shoot anymore, but instead a targeted business where I know that if I send X letters I will get Y responses and chances are I will buy Z number of properties. It’s a simple numbers game. And the best is that my system does not require cold calls, or any kind of “sales” technique. No, the property owner actually calls you and you then make an offer in writing without even talking to the seller again. So if he likes the offer, great he will accept, if not he will toss it out but you don’t have to face the uncomfortable situation of having to negotiate with sellers.

So I am here to tell you that buying properties for as little as $100.00 is very possible, you just need to have the right system in place and need to have a targeted approach and not just some vague idea of how to do this.

When selling a property you own and particularly a vacant piece of land most people only come up with 2 ways, either selling it through a Realtor or selling it as a FSBO, but in either case mostly they are only interested in selling the property for cash, with no financing involved on their side.

However there are dozens of additional ways that someone can sell their property without an expensive realtor fast and for good prices.

Here is just a short sample of the list of 26 ways to sell your property I have put together for anyone attending my educational workshops (see www.secretlandprofits.com)

1. Selling through eBay

Selling through eBay or its sister site www.ebayliveauctions.com always is a feasible way to sell your property. After all it is the largest market of buyers and sellers in the entire world.

2. Selling through your own web page.
   Nowadays, setting up your own webpage is inexpensive and fast. All you need to do is hire a geek from some highschool and they can get it done for you for as little as a couple of hundred dollars. Then place your properties there and if you have some good content which attracts the search engines you should be able to sell your property with minimal cost.
   
   
3. Give your property as a down payment for another piece of real estate.
   If your property is a vacant piece of land located in an area where it might be of interest for a small builder or other investors you can just take your piece of real estate and offer it to one of these interested parties in exchange for the down payment on one of their properties.

4. Trade/Barter the property for services or products:
   There is a growing and large network of Barter organizations in existence in the US where you can trade everything from haircuts to Cars and construction equipment to nail spa appointments. Join one of these networks and offer your property for sale in this forum. Once you sell it, they usually give you Barter Dollars which you can then use to buy services from any other member company. So basically you convert your free and clear lot into barter dollars which buy you a hole host of products and services.

5. Improving your Property:
   Of course one of the best ways to make your property more attractive for potential buyers is to improve it. Put in a Well, Put up a fence, Bring in a Driveway into the best place to build on the property, create a building pad on the lot, … . The possibilities are endless. With any of these you have helped remove one objection from potential buyers being able to say no. A Lot with a Well and fence and/or building pad is obviously much more desirable than just a raw piece of land. It does not cost much to do these things (except perhaps for the well) but the value spike can be massive.

6. Donating the property:
   If done right you can actually profit a lot from donating a property you bought for pennies on the dollar to a qualified charity. I am not an Tax Attorney or CPA so this is not advise. It is just my opinion to the best of my knowledge. It is my understanding that you can donate a property and claim the full Market value of the property as write-off for your taxes against profits made If the charity you donate the property to is somewhat related to the product you are donating. Basically you have to donate a piece of real estate to a charity which has something to do with Real Estate. If you donate a price of land to the local Natural Preservation Foundation, it might work, but if you donate it to your local AIDS foundation it probably doesn’t.

7. One way you always have and which is one of my favorite ways is to just sell the property with seller financing. This will allow you to even increase the price of the property above market value because you are offering such a deal. You can easily take a property which you bought for $1,000 and which is worth $15,000 and sell it with seller financing for $17,000 with a down payment of $2,000 carrying back a mortgage (=note) for $15,000 with payments of $200 for about 8-10 years at a nice interest rate of 10-13%

Particularly if you combine any of the above mentioned Selling techniques you will and should have great success selling your properties fast and with great prices.