Abandoned Property & Tax sales -- please advise
Hi BP-ers,
Like a lot of people, I've been reading this site for a long time, and this is my first post. I am very interested in wholesaling and have just started to really explore it.
I've read that a great source of leads is houses that look abandoned. There's one in my neighborhood--boarded up windows, etc., definitely abandoned.
I looked at the tax assessor's website (I live in Chicago), and saw that the property's taxes had been paid by a tax buyer for the past 3 years. Cook county holds tax sales once a year.
I also looked at the Cook County Circuit Court website and found that the property has a Lis Pendens against it, filed in 2011.
My questions are:
1. If a tax buyer bought the taxes, doesn't that person have a lien against the house/can't they take ownership of the house?
2. Is this place a wholesale candidate?
Thanks in advance for your advice!
Jane
Most Popular Reply
Congratulations on your first post - you don't have to e shy.
Yes this property could be a great wholesale candidate. I don't know if your area sells tax deeds or tax liens. For wholesaling purposes it doesn't make much difference. I will reply as if it is a lien. If it is a tax deed than in most areas there is a redemption period where the owner can reclaim their property.
1) Yes the tax holder has a lien against the property. This simply gets paid off at settlement. Yes the tax holder can foreclose. In either case this is negotiating leverage with the current owner. If it is an active foreclosure the issue is more urgent. However until the foreclosure is final, the owner has the right to redeem by paying off the taxes.
2) Yes this property could be a great wholesale candidate. I don't know if your area sells tax deeds or tax liens. For wholesaling purposes it doesn't make much difference. I will reply as if it is a lien. If it is a tax deed than in most areas there is a redemption period where the owner can reclaim their property.
I suspect the lis pendens is simply the tax foreclosure case. It could be something else which might complicate the deal but also adds opportunity.
Now the above is general info and the rules vary by state, and even from county to county.
Step one is, track down the owner and see if you can work a deal. I did two deals last year with just this situation. One I paid $1,200.00 and the other I paid $2,000.00. Of course those were exceptional deals and not at all typical.
The hard part will likely be finding the owner and if the owner has truly abandoned the property, he or she may not be at all motivated.
Good Luck - Ned