How do you sell your tax deed properties?

Question

I am a "newbie"  to the real-estate and sheriff tax deed sales. I've spoke with a few people and have read numerous articles about tax sale investing. I recently purchased two pieces at the last sale, Now my question is if you plan on selling the properties do you have to quite the title? What about owner finance with a quit claim deed? Once sold could the person in fifa sue and would make me responsible?  Thank you in advance for any kind of help!

Anastasia Jordan · Answer

<-----Alabama

Selling a tax lien/deed is simple in my state. You can make up your own bill of sale & the county has a very simple transfer of assignment form to have the lien/deed assessed in the new owners name. No title company or lawyer needed.  You pay $5 at the tax redemption counter to have the transfer notarized and they assess it that day.  Takes no longer than 5 mins.

Right now I only sell tax liens/deeds to other investors.  I am kinda cautious of selling liens/deeds to laymen as they tend to forget or not understand our state redemption laws.  I also do not sell them anywhere close to what the property is worth.  I couldn't see someone buying a tax lien/deed property close to what comps show without a clear title.  If I wanted to sell it for a fair market value I would have to wait out the redemption period and quite the title.

Anastasia Jordan · Answer

UPDATE Y'ALL:  I decided to expand my advertising outside of the Bigger Pockets circle and posted on 2 Facebook groups and Craigslist.  I had people driving in from FL, GA, TN, and WI to see my tax lien properties that I have purchased and properties that I have applied to purchase from the state (we just call them "quotes" down here = contracts with the state that have a price locked in for 20 days).

Please tell me why I had a good number of THIRSTY WHOLESALERS contacting me trying to get my stuff under contract, who didn't have any money, and didn't have any buyers. Which was totally, totally, totally unnecessary as these properties were so cheap!  I sold my lien on a 3/1 for $2500.  Wholesalers were contacting me wanting me to put it under contract with them so they could make some money on top of what I was selling it for.  Several of them even took pics of my property and started advertising it for double.   One guy even asked if I would do a land contract......for $2500.

I explained to them that all this extra they were trying to do was pointless & if they didn't have CASH IN HAND they should not contact me.  I was also upfront about these just being tax certificates/deeds and they would not have clear title for 3 years and that redemption rights still apply and that this type of investment is geared more toward the buy & hold/rental portfolio/risk taking investor.

Next go round I'm going to sell for more & specify no middlemen/wholesalers.

Me> Meet me at the courthouse with cash.

"I need to get the property under contract to present to my cash buyers."

Me> No, you just need to bring me $2500.

"Um......."

Me> You don't have any money do you.

"I'm a wholesaler......"

Me> *click*

Joe Donohue · Answer

There a number of ways to sell tax deeds.  It really depends on the market, the type of property and the price.Typically we FSBO for a few months before taking on a Realtor.  I would say 60-70% every year we are able to sell ourselves.  We also direct mail all neighbors first before putting up a sign in the yard, especially if it is land.If the price offered is less than $10,000 we most likely will not move forward with a quiet title.  We have sold property contingent on completion of quiet title, initiated by seller and once by buyer.  Over $10,000 the buyer will want more assurances and quiet title is best to start.Selling land contract is also very popular.  I don't mind the monthly payments and we charge low interest.  Also in my state you can get title certification after one year of holding tax deed, which is cheaper than an outright quiet title.  So, by doing land contract, you are holding the deed for 12 months and then the buyer can purchase that certification at the end of the contract.   We have even purchased it for one of our buyers at the end of the contract as a thank you for all the timely payments/great communication. I also suggest using Craigslist to post your properties and any other free means first.  I avoid wholesalers as much as possible, because they tie up the property and time.If you deal with a lot of inventory, like us, I recommend making a simple website to refer potential buyers.  They may see something else they like more.Good luckJoe

Anastasia Jordan · Answer

I've read of several cases were a seller sold a tax-deed property to a non-investor who had absolutely no knowledge of tax-deed laws or what redemption even is and end loosing the house. Some times the seller doesn't even know what the laws are concerning redemption.  If I were to do owner financing for a tax-deed property I would have in my contract that the NEW BUYER would have to sign a statement saying that they met with a knowledgeable real estate lawyer and received counsel on this type of transaction.

Tom Yung · Answer

@Rick Baggenstoss

You are right.

Quiet title is necessary for the sale of your property to an home buyer, down the road. I put this figure into my cost estimate.

Taylor McKinney · Answer

@Anastasia Jordan

Do you purchase the properties from the state first, then sell to investors? Or buy it then transfer it with their cash while at the courthouse with them during the 20 day "contract" period?

Jason Johnston · Answer

Anastasia, do you have a copy of that form you could PM me. I've looked on the county site and could not find a transfer of assignment form.

Thanks

Brooke Boyd · Answer

How long after receiving the tax deed can you start the procedure to quiet the title? (In Alabama) Do I have to get an attorney to do this and if so how much do they charge for quieting the title?

Rick Baggenstoss · Answer

@Tom Yung, I think you can do better than quite the title, right?  Quite title seems to be the strategy for if you are holding on to the property for awhile anyway.

Anastasia Jordan · Answer

I am not a lawyer and am not sure about GA laws and am barely functioning in interpreting the laws in my state for myself.........

From what I understand, to prevent that from happening you need to file a quiet title action as soon as the redemption clock runs out. The quiet title action is what prevents redemption, not marking off days on the calendar.  Still, in order to regain the property, they would have to reimburse you for expenses spent on the property (varies by state).  If such were to occur and they were granted the right to redeem you would still get your money plus more back,

How do you sell your tax deed properties?

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