Losing money on a lien

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Simple novice question: can you lose money after buying a lien?

[Jerry K.]

@Bob E.  is right - there are many ways to lose money in real estate tax liens after you buy.  A couple off the top of my head:

• Property is worth less than the amount of the lien.
• Property is worth less than the amount of the each lien you have to buy before you can foreclose. (In some states you can't foreclose for a set number of years and you need to pay the taxes for each year or you lose the lien position)
• You don't foreclose before the lien expires.  Some state statutes have a set amount of years before the lien expires worthless if the owner doesn't redeem or the lienholder doesn't foreclose.
• Property is worth less than all the liens and foreclosure costs you incur.
• Property has EPA issues that need to be cleaned up if you end up owning the property after foreclosure.  (Example - lien on an old gas station with leaky underground tanks)
• Lien on an improved property is destroyed before foreclosure.

There are many other ways.  State laws all vary.