At Tax lien Sales, sometimes people pay a “premium” or “bid the interest rates down”!!! What is all that about?

12 Apr At Tax lien Sales, sometimes people pay a “premium” or “bid the interest rates down”!!! What is all that about?

Yes, some states have different rules about Tax Lien Investing. I some the bidding is on the down payment and the bidding actually goes downwards from the Max. of let’s say 18% down to 0. In states that use the Premium system, the bidding is actually for the $$ amount of the Taxes owed and the bidding goes beyond the actual amount owed. The winning bidder then gets the highest interest amount on the Lien amount (but usually 0 interest on the premium).