Yes I really got a Florida Condo on the Beach for Under $14k via Tax Deed
Last summer I bought a tax deed on a Condo-Hotel on the Beach in Daytona Beach. Frankly I was surprised because normally a bank or other lien-holder will pay the taxes to protect their own interests - at least thats what I was taught in that very expensive tax lien investing program I bought.
There are very few liens that follow a tax deed purchase. Governmental liens will follow a tax deed purchase. But most others such as mortgages, mechanic's liens, etc are extinguished, which is one reason tax deed investing can be very lucrative.
I am an obsessive researcher. I researched the public records for these 2 condos coming up for auction in May of 2010. Both properties had their "typical" mortgage lien and condo association lien - no governmental liens at all. I verified the tax deed legal statutes in Florida and felt comfortable in knowing this purchase wouldn't be too much of a problem. The first property was a 1 bedroom - and there was another bidder bringing the price higher than I was comfortable with so I just let it go. The second one was a studio and WAHOO! I got it for just under $14,000! ON THE BEACH IN FLORIDA! I couldn't believe it! I was in shock. I even waited a few days before I called the resort to introduce myself. I knew I would have to pay condo fees, so I made the necessary introductions. As it turns out it was on the top floor and classified as a favorable unit to rent out. At that point I couldn't wait to take the trip out there and check it out for myself.
I wasn't really sure what to do with the property. If I wanted to resell it, I would have to get a clear marketable title (a tax deed doesn't come with title insurance). I hired a law firm to perform what's called a "quiet title action".
Confident with my knowledge of the law, the condo association claimed that there was an arrears on that unit. I dismissed it as I had faith my attorney would get this all extinguished. Imagine my surprise when I received a certified letter claiming I owed them not just the previous owners arrears, but penalties, interests, and even a $400 certified mail fee.
Here it is, six months later and I am finally scheduled for a summary judgement hearing in February. In the mean time, due to Florida law, the condo association is allowed to rent out my unit and collect income to offset the arrears. I've been paying my monthly condo fee faithfully and hope to one day see some rental income. The silver lining in this is that it is my condo, and I and any of my friends or family can stay there with only a $25 cleanup fee.
If you are reading this, you are my friend and I will give you a "friends and family" discount on a cute condo right on the beach close to town. Just comment below.
There are very few liens that follow a tax deed purchase. Governmental liens will follow a tax deed purchase. But most others such as mortgages, mechanic's liens, etc are extinguished, which is one reason tax deed investing can be very lucrative.
I am an obsessive researcher. I researched the public records for these 2 condos coming up for auction in May of 2010. Both properties had their "typical" mortgage lien and condo association lien - no governmental liens at all. I verified the tax deed legal statutes in Florida and felt comfortable in knowing this purchase wouldn't be too much of a problem. The first property was a 1 bedroom - and there was another bidder bringing the price higher than I was comfortable with so I just let it go. The second one was a studio and WAHOO! I got it for just under $14,000! ON THE BEACH IN FLORIDA! I couldn't believe it! I was in shock. I even waited a few days before I called the resort to introduce myself. I knew I would have to pay condo fees, so I made the necessary introductions. As it turns out it was on the top floor and classified as a favorable unit to rent out. At that point I couldn't wait to take the trip out there and check it out for myself.
I wasn't really sure what to do with the property. If I wanted to resell it, I would have to get a clear marketable title (a tax deed doesn't come with title insurance). I hired a law firm to perform what's called a "quiet title action".
Confident with my knowledge of the law, the condo association claimed that there was an arrears on that unit. I dismissed it as I had faith my attorney would get this all extinguished. Imagine my surprise when I received a certified letter claiming I owed them not just the previous owners arrears, but penalties, interests, and even a $400 certified mail fee.
Here it is, six months later and I am finally scheduled for a summary judgement hearing in February. In the mean time, due to Florida law, the condo association is allowed to rent out my unit and collect income to offset the arrears. I've been paying my monthly condo fee faithfully and hope to one day see some rental income. The silver lining in this is that it is my condo, and I and any of my friends or family can stay there with only a $25 cleanup fee.
If you are reading this, you are my friend and I will give you a "friends and family" discount on a cute condo right on the beach close to town. Just comment below.
Comments (16)
http://www.chriswickersham.com/wordpress/florida-tax-deeds-vs-hoa-or-condo-association-liens-and-assessments/ This may be useful.
Michael Moose, almost 12 years ago
To both Jean and Norton, Great info! I am preparing to purchase tax deed property in Florida that had gone through foreclosure by the condo association and had a mortgage foreclosure that was still pending. The condo association foreclosed, received certificate of title but did not pay the taxes. There is a chance that the sale won't occur because the owner's filed bankruptsy. BUT, if it does and the condo association didn't pay the taxes my question is if they already received title that satisfies the condo association liens, right? If they or there attorney was asleep or didn't want to pay the taxes and they lose the property, should be a no brainer on the past due assesements, right? Thoughts? Thanks this is quite helpful..... Matt
Matt R., over 12 years ago
Any news?
Rey Delgado, almost 13 years ago
Thanks for the update. Please do post once you get quiet title. I'll do the same.
Rey Delgado, almost 13 years ago
The Florida law says income received on a condo with arrears goes to the association. I'll get it back.
Jean Norton, almost 13 years ago
What happened with this Jean?
Ruth Bayang, over 9 years ago
Hello Jean, I'm in awe. You mean to tell me that the HOA took the condo that was in your name (tax deed) and rented it out? I thought that the HOA could only ask your already existing tenant to forward their rent monies to the HOA or be evicted. Btw thanks for the link to the land trust site. I'm waiting till they come to Florida to attend, as opposed to the DVD program.
Rey Delgado, almost 13 years ago
UPDATE: Out of sight, out of mind...they've started paying me for the rentals but negotiations have stalled regarding paying the previous earnings and my attorney fees. We will file in county court (unless they act quickly) and due to a previous district court ruling in favor of the tax deed owner we expect things to finally be resolved. Anyone interested in a condo on the beach? I'll owner finance.
Jean Norton, almost 13 years ago
The Florida Legislator’s eroded in their bill. The Tax Lien knocks out the association. The attorneys attempting to pressure and cause you distress are not thinking correctly. If I own a condominium $20,000 in association liens; and,if I deed it to the Judge in the condominium case, does he-she have to pay the $20K? If I deed the unit to the attorney attempting to collect, do they owe the association? What about the person that paid the tax certificate as an investment. If no-one bids on the property because of the legislator’s error, does the certificate buyer become obligated to the association for 20K, when they end up owning the unit because no one paid the taxes at the auction? The answer is no. But you will have to pay to play. The legislation is unconstitutional. Power to the people.
Gary Phillips , almost 13 years ago
Hi Gary, We have an active case in Miami-Dade that is identical to yours. The HOA filed for foreclosure and we decided to merge both cases (quiet title and HOA) to reduce our legal fees. Our has not been set for hearing yet. Email me at [email protected] if you're interested in sharing info.
Rey Delgado, almost 13 years ago
Hi Gary, We have an active case in Miami-Dade that is identical to yours. The HOA filed for foreclosure and we decided to merge both cases (quiet title and HOA) to reduce our legal fees. Our has not been set for hearing yet. Email me at [email protected] if you're interested in sharing info.
Rey Delgado, almost 13 years ago
Jean, I'm an attorney in South Florida and I have a client who just purchased a condominium via tax deed sale. We are having the same issue as you - the condo association is claiming their lien for unpaid assessments due by the prior owner survived the tax sale by vrture of the 2010 amendments to the condo statute that make new owners jointly and severally liable for the prior owner's past due assessments. I was wondering if I could get the name of your case and the contact info. for your attornets so I could discuss this matter with them. Thanks.
Monica Tirado, over 13 years ago
We are in final negotiations - the COA will pay all back condo earnings and we are negotiating atty fees. Still not final, but will be soon.
Jean Norton, over 13 years ago
We had our first hearing and had a "partial victory". First the bad news: someone associated to the title heard about the hearing and couldn't be there for the hearing so it had to be rescheduled. Now the good news: the opposing counsel's "motion to dismiss" was denied. They have 20 days to argue this...I have a feeling this may take a long time.
Jean Norton, almost 14 years ago
Both sides feel they will prevail. I'll keep you posted.
Jean Norton, almost 14 years ago
Keep us informed. Does your attorney agree with your interpretation of the laws?
Account Closed, about 14 years ago