All Forum Posts by: Don McAlpine

This is best asked of an attorney in the state the property resides, but a Special Warranty Deed only warrants the title for the timeframe the previous owner held title.  This might be adequate for whatever you want to do with the property, but offers less protection than a General Warranty Deed that would offer truly clear title.

Not legal advice...

You should negotiate a bigger discount.  Without all of the paperwork the note is less valuable than one that is fully-compliant.

It's highly unlikely, if not impossible, to find a traditional lending source to fund the purchase of tax deed property.  There are a myriad of reasons why, but the risk involved negates any profit potential for a traditional lender.  The minimum six-month to two-year redemption period is also a major problem for a lender.

If you don't have your own money, the best method is to raise private capital. Although you don't have a lot of experience, you could look for a fix and flip or BRRRR investor, partner with them on a purchase and split the profits. Solicit other investors looking for a solid return, self-directed IRA investors, or basically anyone that currently invests in real estate. Before beginning the process you should speak with an attorney to ensure your strictly adhering to the law.

Identily a property that you would purchase and your target acquisition price and work out the ARV to show the potential profit spread. Create a graphic and post messages on social media and to your sphere of influence looking for a "funding partner". Be prepared to answer a lot of tough questions about the risks and the process in general.

On the plus side, having to pay cash and be at the auction in person usually roots out the "know nothing" buyers that drive prices up.

Many of the things you can do during the redemption period are spelled out in the state statures of where the property is located.  I would be hesitant to put any money into a property during a redemption period as you would put your capital at risk if the property is redeemed or the sale is successfully challenged.

Once the redemption period passes and the county issues the deed directly to you it would be safer to begin any renovations.  To get top dollar for a renovated property you're going to have to clear the title as it would be very difficult, if not impossible, to find a title company that will write a policy for title insurance on a property coming from a tax sale.

 "This dude on Instagram said it's the easiest way to get rich..."

The overwhelming majority of tax liens are ultimately redeemed, so buying in your name in search of anonymity down the road shouldn't be an issue. If you do ultimately foreclose on the property then you could transfer the deed to your LLC at that point.

 You can find a list of upcoming FL lien and deed auctions on Property Onion (just add a .com) and many of the lien sales are held on Lien Hub.

The L.A. auction usually has thousands of properties up for bid, a significant number of which are vacant lots.  You'll often find good value in the lots and you'll have fewer issues selling them.

The answers to your questions depend on your strategy in acquiring properties at tax sales.  Are you going to rehab and hold them?  Rehab and sell them?  Sell them as is?

You need basic spreadsheet skills to conduct research, but might want more advanced skills to do analysis.  If you're going to sell the properties with or without rehab you'll want to have a robust CRM to manage your distressed homeowner/buyer/attorney/vendor lists.

The advice from Bruce is solid...start slowly and you'll figure out exactly what you need as you proceed. 

 Thanks Jacob.  I'd be curious to know what the "challenging rule" is that held up your sale?  In my case, the QTA or Tax Title Services wouldn't work and so we're looking for an alternative like John suggested above.