There's a bunch of tax lien funds out there. I've met a few of them when standing in line to pay for liens in auctions in SC. The one caveat with most of them is that you have to be an accredited investor in order to put money to work with them, which means you have to earn more than 200k per year or have more than 1M in assets.
Huge funds:
- Magnolia Advisors - these guys focus on FL only and borrow heavily, they have access to cheap financing so they bid the interest down to low single digits on most liens (http://www.magnoliaadvisors.com)
- Tower Capital Management (they are backed by Fortress - a huge private equity firm, I've contacted them before but they are not accepting new funds (http://www.tcmfund.com)
- Alterna - they operate in more than 10 states, bundle the liens, and securitize them (http://alternacap.com)
Medium size funds (not pure play - these guys invest in tax liens but they also invest in other stuff):
- Kislak Organization (https://www.kislak.com)
- Broad River Capital (http://broadrivercap.com)
Small funds:
Comian Investment Group - Ms. Dougherty seems to know what she's doing - every once in a while she raises new funds, I believe in the size of $2.5M per fund. You can invest through an IRA into one of her funds. She doesn't have a website, but her presentations are available online: (http://taxlienlady.com/Comian/FactSheet.pdf) , (https://gem.godaddy.com/s/5032c7?o=fm). I've requested her PPM before - she charges 3.5% annually of all the assets and also collects 25% of any profit from the sale of properties. She doesn't take any profit from the interest income and passes that to investors.
Distressed Realty Fund - they are raising a $5M fund (Their PPM is public) - they promise a 1% per quarter dividend to investors. They also pay out an annual dividend of whatever profit they make minus 25% that they keep as their performance fee. They also take a 2% fee of all the assets as their management fee per year. (http://www.distressedrealtyfund.net)
Blueprint - These are young guys that operate in 3 states (SC, GA, TN) - they focus on technology to help them do due diligence quickly. Their fees are lower than others because they are new - I think they take 20% of profits (after all expenses) - regardless of whether they come from interest of sale of properties. They also have a threshold - if they don't earn their investors at least 8% IRR then they don't get any of that 20% fee. Their annual management fee is 1.5% of assets. (http://blueprint-ventures.com)
The whole tax lien market is about $15B per year, but I actually think smaller funds have the ability to get better returns than larger funds because they can be more selective and don't have the pressure to constantly put their money into something. If I was making $200k a year I'd probably go with one of the 3 above.
