Purchasing tax lien certificates is one way we get real estate in our portfolio without actually investing in property. When a property owner fails to pay his or her taxes, the municipality in which the property is located sells the tax lien for the property. i.e. the right to foreclose on a property when the owner has failed to pay taxes. We buy the liens in an auction, paying the amount of taxes owed in return for the right to collect back that money plus an interest payment from the property owner. Interest rates vary, depending on the jurisdiction or the state. For example, the maximum statutory interest rate is 16 percent in Arizona and 18 percent in Florida, while in Alabama the rate is fixed at 12 percent, according to the National Tax Lien Association, or NTLA. The interest rates make tax liens an attractive investment for us because Liens are also the first in line for repayment, even before first mortgages. Check out our Lands Available for sale. We also offer owner financing.
