Self Redeem as a failsafe?

[Danny Price]

Im trying to understand how an investor "self-redeeming" a tax lien or deed would be a good idea. Maybe I've been mis-informed. 

I'm in Georgia, a tax deed state. When tax deeds are auctioned off here, they typically sell for more than asking price (overage). The penalty in GA is 20%. 

The scenario I've heard about is an investor buys a tax deed (with overage), and for whatever reason determines he doesn't want the property. So, he redeems the tax deed himself. He will lose some of his bid amount, but thats better than keeping a property with some major issues (structural, or environmental) . 

The idea is he will get most of his money back. 

However, I've also been told that the original owner is entitled to the overage, even if THEY redeem! 

I don't see how both could be true.

[Ed Tamayo]

@Danny Price

In Georgia, self-redeeming would mean to give up all the money paid for the property and it would consist in signing a quit claim deed to the former owner.

I suppose that could make sense only if the property is truly worthless or it is a  liability as you point out and there is no point in keep being liable for it. Also, some lenders want to make sure you are paying taxes in all your properties and deeding that property would take it out of your “books”.

Still, the former owner could say that you can‘t dump a property (and its liability) on them.

Finally, yes, the former owner is entitled to the overage in case they redeem or not. (in GA, not true in other states like South Carolina) 

In GA it  would only be a failsafe to prevent losing more than your original investment.