What do you think of this strategy?

Question

I am reading an ebook and it presents the following strategy:

1. Find out which homes in your area have tax liens on them.

2. Write the owners, tell them if they are planning not to redeem, you will give them $100 (or other small amount) for a quit claim deed giving you the property.

3. You record the deed.

4. You sell the property.

Sounds simple, but does something like this actually work? Has anyone done it? The author claims to have used this strategy many years to acquire a ton of properties, but I am skeptical. Any thoughts would be appreciated.

Account Closed · Answer

I would agree with what Ryan has said.

Do note that you can make serious money for the effort involved. Hence you will likely earn more from a few good deals than most people earn working in a J.O.B. over the same period of time. RE investing can be accomplished as a part time activity so no need to jump in full time when you are getting started.

John Corey

Ryan Webber · Answer

Real estate is not a get rich quick scheme.  Its a work your tail off for years and get rich scheme.

Ryan Webber · Answer

Well, couple things.

First, do NOT use a Quit Claim Deed for anything.  Use a General or Special Warranty Deed.  In Texas at the least, Quit Claim deeds are completely worthless.  They are not a valid transfer of title anymore.

Second, finding deals is hard work.  See its not just writing the owners who are behind on their taxes and telling them you'll give them $100 or a $1000 and then they sign over the deed.

You could say that working pre-foreclosures is writing the owners and telling them you'll give them $1000 and then they sign over the deed and then you sell it, BUT the reality is you have to stalk 20 different people writing, calling, knocking on doors just to talk to them so that 19 will slam the door in your face so that you can maybe talk to one of them about their situation.  Now 90% of the time that 1 person who will actually talk with you will loly gag with actually selling you the property or selling anyone the property or even refinancing the property before the actual foreclosure.  They'll want to think about it, they'll want talk about it, and they'll end up procrastinating until the day AFTER the house sells at foreclosure and some investor is knocking on their door telling them to get out.

Point being, most techniques work, but they require a tremendous amount of work to have any significant amount of success from them.  If you are not willing to work at it consistently and persistently day after day, week after week, month after month, year after year, you will not make this into a successful business.  It will just be an expensive hobby.

Lastly, yes, you can buy houses from owners who have tax liens/back taxes on their property.  I've bought many properties with back taxes on them (Texas doesn't have property tax liens) that would have been foreclosed on by the county soon after that.

N/A N/A · Answer

Thanks for your helpful insights. I pretty much figured it was possible but way harder than what was being portrayed, and your post seems to confirm that.