Tax Certificate Sales - Is 1/4% worth it?

[Sean Dotson]

So I finally found some records on past tax certificate sales in my area.  A VAST majority for them went for 0.25% (18% is the starting bid). 

What's the logic in this?  If the owners pays the tax it's hardly worth the effort for 1/4%.  Are the hoping to wait the 2 years then foreclose and own the property outright?

[Jerry K.]

Sounds like a Florida tax certificate auction. Check the statutes as there can be a 5% minimum payment even if the winning rate is below 5%. Note if the winning bid is Zero percent (0%), then no 5% minimum payment is made - (from a Florida state website for the statures on tax certificate sales):

"197.472 (2)When a tax certificate is redeemed and the interest earned on the tax certificate is less than 5 percent of the face amount of the certificate, a mandatory minimum interest of an absolute 5 percent shall be levied upon the face value of the tax certificate. The person redeeming the tax certificate shall pay the interest rate due on the certificate or the 5 percent mandatory minimum interest, whichever is greater. This subsection applies to all county-held tax certificates and all individual tax certificates except those with an interest rate bid of zero percent."

Here is a link to the Florida state statutes that lays out the entire process. https://www.flsenate.gov/Laws/...