All Forum Posts by: Denise Evans

If it is heir property and you can track down AT LEAST one of the heirs and throw them a little cash for a quitclaim, you will become a co-owner. That gives you lots of advantages, including the right to possession. Take the quitclaim title in another name/entity than the tax certificate. That way you are protected if there is a redemption. The problem to be avoided by the two different entities is something called "merger." Sometimes important rights are lost because different types of interests acquired at different times but in the same person/entity, get merged. The merger sometimes causes some rights to drop off. Call me if you want to discuss and flesh out.

Evictions in Alabama are supposed to be fast tracked on the District Court docket. That is the trial court of limited jurisdiction that does not have jury trials.

The only reasons I can think that it might have taken 6 months for a writ is because of the two most common reasons. One: the attorney failed to take a default judgment as soon a he/she was able, 15 days after service. Nail and mail service means you don't even have to actually find the person to serve the lawsuit papers, so delays in service are not an issue.  Two: the tenant answered and denied everything, which forced a trial. Trials are supposed to be set ahead of all other cases, so you should have gotten a trial date in 30 days. Then again, if the tenant asked for a continuance because of any sort of semi-plausible reason, that might add another 30 days. Let's suppose the next time, your attorney has a conflict and asks for another date. That might add another 30 days.  Once you get an order in your favor, that is final and non-appealable after 14 days. Boom, you are ready for your writ.

BUT, Jefferson County is running 4-5 months behind on serving writs. That is the real bottleneck. For Jefferson County, I usually recommend cash for keys if the tenant leaves it broom clean and not severely damaged. People will grab for the cash instead of thinking, "Wait, is this in my best interest? Maybe with the cash savings vs. the cash for keys, it's better if I drag this out for a year and have no rent to pay."  No, they go for the quick cash. Often, return of security deposit and another half month of rent will get it done. It really burns to pay a terminated tenant to move out, but the economics almost always work out better.

Make sure you get a full release from the tenant when they get the cash, you they cannot then turn around and sue you over supposed things YOU did wrong while their landlord.

If a property contains a residential structure, a redeeming party must pay you for the value of any improvements, but only if you gained lawful possession when you made the improvements. 

An ejectment order from a judge is a "for sure" lawful possession. A signed surrender of possession from the owner, or a lease signed with you by the owner, also qualify as "lawful possession." Anything else is risky because the owner could claim that, although the property was vacant and in bad shape, it was not legally abandoned. If not legally abandoned, you are not allowed to do DIY possession. That would be unlawful.

If the residential structure is demolished, then the property no longer contains a residential structure. A redeeming party is not obligated to pay you for the improvements.

In other words, once the building is demolished, you can't do anything. I recommend meeting with city officials and explain your plans. I have found most of them to be very understanding and easy to work with, willing to wait until you can lawfully take possession.

Gabriel, you have my contact info. Call me. I need a lot more info before answering.

@Sean Richards I'm in Tuscaloosa, but I imagine Auburn is a very similar market.  Great market because of all the students. Be prepared for student lease signings in October for terms beginning the next year, in August. If you miss that window, or have someone default, it's going to be a long time until you find a replacement. But, low risk of monetary loss if you handle the parent guarantees properly. Let me know if you'd like to expand into Tuscaloosa.

Alabama property taxes second lowest in nation, and also very landlord-friendly laws.

Alabama taxes computed as follows for a rental property:

Tax Appraised Value = $200,000 (for example)

Tax Assessed Value of 20% = $40,000 (example)

Millage rate of $52 per $1,000 of Tax Assessed Value = $40,000 x 0.052 = $2,080 annual tax bill for a property valued at $200,000.

Right now, you probably can't go wrong anywhere with a buy/refurb/flip strategy. With interest rates up, homeowners are holding on to their homes until interest rates come down again. The pool of buyers continues to grow. Fewer houses are available for purchase. Bidding wars don't help, because high interest rates make it harder for buyers to hit their required debt to income ratios.  With continued logistics problems, labor shortages and the high cost of materials, builders can't simply start building more to meet the demand. The answer is to buy and upgrade existing inventory, which seems to be your target.  My only advice to tag onto that is find properties in peripheral neighborhoods and buy at least 4 homes on the street. That way, you turn the street yourself, instead of waiting for the market to produce more refurbing buyers that will eventually turn the street.

They pay the BPO amount plus interest since the date of purchase. The original statute said the redemptioner had to pay the full amount of taxes plus all interest. That made buying BPOs VERY lucrative. But, the Alabama Supreme Court ruled the statute unconstitutional in the mid 1980s. Ever since, redemptioners pay only the BPO price, plus interest.

Payment is made directly to the investor who owns the tax deed.

I'd be more comfortable with $1 million of liability. All it takes is a house fire or similar and a death to climb way above your $350,000 limits. 

In Alabama, a wrongful death lawsuit carries punitive damages as the measure of damages. That can reach $1 million quickly. In other states, the measure of damages is the loss to the person bringing the lawsuit. For a baby with a long life expectancy, damages might be large. For an elderly person with multiple health problems the damages might be small. All irrelevant in Alabama.  How much does the jury think the defendant should be punished for the death is the measure here.

When I say "punitive" I don't mean how horrible was the property owner in its actions that led to the death. It's just how the jury wants to redistribute insurance company wealth.  I've been a defendant in a boundary line lawsuit (I was the evil developer) where exactly that happened.  I had insurance company lawyers. My surveyor, who was also a defendant, had insurance company lawyers. The plaintiff was a little old lady with a lawyer who dressed liked he bought his clothes at the church rummage sale.  After a week of trial, SIX of the jurors wanted to give the little old lady a huge paycheck of actual and punitive damages, on the first vote. Because supposedly we cut down 1/3 acre of "her" so-called "old growth hardwoods" of poison ivy and hackberries (a trash tree around here.) It took a solid day of jury deliberations and a cautionary instruction from the judge for them to do their job according to the law and the facts and return a verdict against the plaintiff.  Which should have been clear from the very first minute.  

So, get a $1 million. Additional liability coverage is relatively cheap.

Okay. Just curious. Thanks for sharing.