All Forum Posts by: Patrick G.

I still have not pulled the trigger on my first real estate investment. I recently had lunch with a buddy who is a Realtor and owns a few properties he rents.  We were talking shop, I mentioned I would 100% need a Property Manager, as I am not in a position to take calls about clogged toilets and such. 

He said for one property, don't use a property manager, just purchase a Home warranty, and give the tenant the repair number.  Like "Don't call me, call this number."  He said the service is like a maintenance portion of a property manager, where they contract with various trades such as electricians, plumbers, carpenters, etc. and send out whoever is needed.  Often they respond in 24-48 hours. 

It sounded too good to be true.  I tried to think of a situation that his theory would fall apart.  The best I could come up with is burnt out light bulbs, this repair service isn't going to want to come out for trivial stuff, that a normal homeowner would take care of, but a tenant might feel entitled too.  I don't want to pay $150 to have a light bulb changed.  He said you just write a clause into the lease about normal maintenance items such as light bulbs, items with batteries etc. 

It seemed pretty iron-clad but still sounds too good to be true.  The maintenance/repair part is really the only service of a property manager that I just don't want to deal with. I don't mind screening tenants and dealing with contracts, etc. 

Has anyone done this before? Is it crazy, am I missing some reason why this wouldn't work? 

Thanks

Congratulations Christina and J!

I know how much hard work (and worry) that Christina put into this deal.  To walk away with that kind of profit is exceptional.  But what is more valuable is the experience gained and the connection established! 

Awesome Video! Thank you for sharing this great learning experience! 

I'm not going to purchase the Paper copy from the City, I didn't last year either.  If your willing to do a little computer work you can create the list from the auction results.  I prefer to have the list in excel format so I can weed out all the bad properties and sort them the way I like.  Plus it saves me a couple bucks. 

 It honestly doesn't look like it, but I'm still not 100% sure.  I guess by default, it's no, since I haven't put any real effort into it. 

Too Late for the 2014 Online Auction, however It's never too late for Over the Counter Tax Lien purchases.  It may be too early for the 2014 results list from the County, I haven't checked, but they will sell you a 2013 OTC list before the 2015 is released.  

The tax liens are on a 2 year cycle, so the leftovers of 2013 Auction are available for purchase OTC until 2015, when they will be auctioned off again. 

On the left over list, you purchase the lien for the face amount of the lien.

You can purchase the list at the Cashier Counter at 200 Holliday Street about one week after the Assesment Sale.

However, if you don't mind doing a little work in excel you can re-create the list from the Assesment Sales result. (You simply filter out all the tax lien that were purchased in the assesment sale)

A good lawyer who is familiar with the tax lien process can help you along the process. Of course, I wasn't able to foreclose on my previous property, but I did walk through the process far enough. I wouldn't describe it as "Hard" but rather as "Confusing". I can definitely see how the process keeps away the faint of heart.

Errrr... Yea.... That's a good question. The main advantage to buying Over-The-Counter tax leins is you don't have to front the $100 entrance fee. Not a big deal when you are looking to invest a couple thousand, but when I was buying my first lein that would of definitely put me in the negative.

The other advantage is that you know you are getting 18% interest on your money (Or a property).

I am curious how the process looks from the inside of the auction, they got a lot of out-of-state bidders, and it has to be streamlined for them, or allow them to handle things over the phone.

@Christina R.

It is hard to believe a year has gone by! I can see why this keeps @Ned Carey busy all year round. I'm definitely ready to start weeding through a huge excel file of property data, it will make it feel like warm weather is finally coming!

GAME OVER!

Well, My first run as a Tax Lien investor is officially over. I came home yesterday to a check from Baltimore City for the Property. I had a little bit of a scare becuase the check I recieved did not include the fees for the Substaintial Repair Certificate or the Lawyers Retainer. That is $600, compared to my tax lien investment of around $450. However I contacted the Lawyer, and found out the Fees were paid directly to him, so he will forward a check to me for that amount.

All things said and Done, here are my numbers:

06/20/2013 -$459.48 Initial Tax Lien Purchase

06/20/2013 -$2.50 VCN Fee (The City Office Charges you to pay by Credit Card, next time bring a check)

06/20/2013 -$2.00 Parking

06/24/2013 -$100.00 SRC Application

07/08/2013 -$500.00 Lawyer's Retainer

07/26/2013 -$2.00 Parking (Drop off SRC)

08/20/2013 -$2.00 Parking (Pick up Tax Certificate)

_____________________________________

Total Cost = $1,067.98

10/24/2013 $483.50 Check from the City for initial Lien and Interest

10/30/2013 $600.00 Check from Lawyer for Fees

_____________________________________

Total Reimbursements = $1,083.50

So Basically my brother and I made $15 in four months. Obviously that was not worth our time in the 3 trips down to the City Office. However it was an invaluable experience and learning oppurtunity. If you just look at the interest paid, we made over 5% of our money in 4 months. If we would have invested more money, then the overhead costs we paid would seem much less in comparision. So I can see how the big players are using tax liens as a great investment tool.

Overall I am rating the experience as very positive. I really appreciate the support and guidance put out by the biggerpockets community and especially Ned Carey. I hope to try this again next year!

Well that was a disgustingly creepy analogy. I'm going to go wash up with bleach now.