How to purchase a delinquent tax property to reside in?

[Tiese C.]

Good Morning,
I would love to purchase my first home from a delinquent tax sale. However, I don't see how that will be possible. I currently live in Norfolk, VA and I get the monthly listing from the two law firms that handle these properties for the city of Norfolk. Basically, what I've been told by the lawyers at the firms is that you have to give them a $1500 deposit to bid...if no one bids against you on your property...you get the property and have about a week or so to come up w/ the balance of the money. Now, they've said it takes about 9 months before the property is completely yours. And that's how long the homeowners have to reclaim their property, too. They've also said that there is an additional $10k in fees on top of the back taxes owed that would have to be paid. So, my limit would be $20k, based on the properties on the list that I would be interested in.

My question is...how do I purchase a home to buy? I don't have a stash of money. I got approved for a loan to purchase a home, but evidently, that doesn't qualify to purchase a delinquent tax property. I do want to invest in real estate, but my lease is up on my apartment March 1 & I would love to purchase my first home before then.

So any help and adivce that I could get would be greatly appreciated. I'm sure there's a way to make this happen and I know I"m on the best site to find out.

Many thanks,

[Josh Hansen]

The lawyers you have been talking to are absolutely wrong. All sales at a tax deed auction must follow VA statute, which clearly spells out what happens.

First, there is no right of redemption in VA. Once the confirmation of sale happens (about 30 days later, unless there is a challenge) you have the special warrantee deed in about 10 days. That gives you complete rights to the property. Unless there is someone living there (and that is rare since most of these places need significant renovation) you can go right in. If you have to do an eviction, that might take a little more time, but it only cost a few hundred dollars.

The cost for a tax forclosed house is usually around 35 cents on the dollar of assessed value. Then add 10% as a buyers premium. So if the house assesses for say 100K, fair auction price is around 35K, depending on how much money is in the room. Add 3500 as your premium, and you walk out the door for 38500. Closing times vary, depending on who runs the auction. Anywhere from 10 days to 30 is about standard. Usually you have to put between 10-30% down on the day of the auction. Sometimes it's pay in full that day. Read the terms of sale carefully. Message me and I can give you some more info.