Tax Title Services – Company I have used to get marketable title on a tax deed in 30-45 days without having to do a quiet title action.
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Another fact, Property tax bills comes due by March 31st in Florida and if they are not paid by then they are considered delinquent and could be sold at a public auction after 2 years. So what happens if a homeowner or lender doesn’t know their property taxes are due?
The tax assessors send tax bills to homeowners annually. If you haven’t received your property tax bill, or if your address differs from the one shown on your tax bill and you have a permanent change of address, you need to contact the county to update your mailing address. As investors we sometimes want to maintain our privacy but the tax bill is one area you want to make sure ‘the man’ knows exactly how to find you to deliver the bill and any other notices.
When a property has become so far delinquent that it is headed to the tax deed sale, the county sends out warning letters containing the notice of the auction. The letters go the property’s owners’ last known mailing address as well as other interested parties (lien holders). Although some counties will go the extra mile to research further if a property owners’ correct address, they are not required to bend over backwards to do this additional research.
Homeowners who fail to update their address will not get the tax bill nor the all important Notice of the Auction. This can pose an interesting problem for bidders at the auction. Bidders have to ascertain whether or not the county properly notified the owner in order to prevent the homeowner’s from challenging the sale later. Most counties have been conducting these sales for 100 years or more and are pretty good at notifying the owners and interested parties.
Part of the process involves: Advertising in the local public notice newspaper for several weeks prior to the public auction; It also involves sending regular mail and/or certified mail notices of the sale; There are times when a sheriff’s deputy is sent to serve the ‘interested parties’ with the official warning letter.
The warning letter contains the location of auction, amount of taxes owed, how to payoff the taxes (redeem) as well as how to make the payment to prevent the sale. Buying at the tax deed auction requires that bidders understand the Notification process in order to get marketable title later.
Tax collectors in Florida send out tax bills in October and offers discounts if the taxes are paid early:
4% discount if paid in November
3% discount if paid in December
2% discount if paid in January
1% discount if paid in February
The gross amount is due in March
*Answers: 1)Warren Buffett 2) The Spring
What exactly are Tax Liens and Tax Deeds? If a homeowner doesn’t pay their taxes, a Tax Lien is placed on the property. The Tax Liens are sold to investors who can earn 5-18% annually in FL and up to 24% in some states. We’ve bought tax liens at 18% without competing against other bidders. If the homeowner doesn’t pay off the taxes within 2 years, they risk losing their property at the Tax Deed auction. At these Tax Deeds auctions the winning bidder gets immediate possession of the property however the title is not yet marketable by title insurance standards. This is there the ‘title rehab’ as I call it begins to get marketable title.
As an Investor, you can buy either the Tax Lien or Deed. Tax Lien auctions are held once a year in Florida (in May). Meanwhile, you can buy the actual properties at the Tax Deed auctions year round. After the sale is over there are more ways you can still turn a profit such as a $40,000 payday two of my students got without having to purchase the property.
I’ve been investing in for more than 10 years. Four times a year, I take about a dozen students to a Tax Deed Auction and then spend two days teaching them all they need to know to be successful at Tax Deeds & Liens. As a CFRI member you have a chance to join us on the 2 Day Tax Deed & Lien Field Trip at a discounted rate.
Back to Marketable title, not only is it important when you are buying tax deeds but it is also essential in all facets of real estate regardless of the way you are purchasing the property. People outside the Tax Deed business might tell you that you cannot get clear or marketable title on a Tax Deed. Truth of the matter is that not only can you get marketable title on a Tax Deed… but there is more than one way to get it!
Black’s Law dictionary defines marketable title as ‘a title that a reasonable buyer would accept because it appears to lack any defect and to cover the entire property that the seller has purported to sell; a title that enable a purchaser to hold property to sell; a title that enables a purchaser to hold property in peace during the period of ownership and to have it accepted by a later purchase who employs the same standards of acceptability.” The same dictionary defines clear title as ‘a title free from any encumbrances, burdens or other limitations.’ An encumbrance is a fancy word for a lien. Although a property can have a lien, like for mortgage or tax lien, that lien will not prevent the transfer of the property. It’s important you learn what the various liens are and how it will affect your title’s marketability.
I am not an attorney and this is a subject you may want to discuss with your title company or attorney howeverI think the most important title is one that is marketable title. Marketable title means title companies will offer title insurance after they have reviewed it. Clear title is not always available because these days many properties have encumbrances such as a homeowner’s association restrictions, condo association restrictions or easements etc. Almost all title policies have exceptions on the policy due to that fact.
Here are 2 of a few ways you can easily get marketable title when you buy a tax deed:
1. One of the methods that is sometimes used is through the previous property owners. You can get clear title to a piece of property you bought at a Tax Deed sale by getting in touch with the previous owners. That’s right those same people who lost the property at the Tax Deed Sale. They may or may not be willing to work with you, but you won’t know unless you contact them. When you do reach these people you’ll have to make it advantageous for them to help you.
That simple move of contacting the previous owners can save you thousands of dollars in legal fees and court costs. Not only will it save you money but it can also greatly reduce the time it takes to get marketable title. I can show you what you need to have those previous owners do to give you the marketable title and what you should say to them.
But hold on, there’s more that you need to know before you reach out to the previous owner(s). Working with the previous owners only works in certain circumstances. What are those circumstances? And can you find out if the property you are interested in is a good candidate for working with the previous owners? Yes, you can know before the auction if that particular property will be a good candidate for working with the previous owners. In the long run, this will save you thousands of dollars.
2. File a Quiet Title suit to get marketable title. The Quiet Title suit is the court’s way of verifying that the County Clerk correctly administered the Tax Deed Sale. During the Quiet Title the court verifies that all property owners and lien holders were properly notified. If all goes well it can take 3 months.
An action to quiet title is a lawsuit brought in a court having jurisdiction over land disputes, in order to establish a party’s title to real property against anyone and everyone, and thus “quiet” any challenges or claims to the title. Black’s Law Dictionary says this legal action is “brought to remove a cloud on the title so that plaintiff may forever be free of claims against the property.
This is one step you do not want to take lightly. You HAVE to pick the right attorney to do a Quiet Title. That means you pick an attorney that has EXPERIENCE doing Quiet Titles.
Quiet Title Suits are one of four methods to get marketable title. Title companies will not insure a property unless it has marketable title. It is very difficult to sell a property if you do not have marketable title.
Quick Tip: First things first you need to start marketing the property if your intentions are not to keep the property. Don’t wait until the title is marketable to start marketing, you have to start your marketing like yesterday. The property can go under contract while the Quiet Title is underway or even before the Quiet Title and just set the closing until after the Quiet Title is complete. If you intend to keep the property you can concentrate on just the Quiet Title.
Let’s say you don’t know any attorneys in your area or you didn’t buy the property anywhere near your region of the state. Using the right attorney is about 80% of getting a Quiet Title completed successfully. 80%, that’s a pretty high number… so you can see how significant this step is to be successful. How do you find a QUALIFIED attorney to do the Quiet Title? The emphasis is on ‘QUALIFIED’.
No matter where you are the answer can be as close as your fingertips… literally. I’ve got your attention now don’t I? I will show you how to find some of the best attorneys out of the newspaper’s legal notices.
On the Queen Of Tax Deed’s 2 Day Tax Deed & Lien Field Trip you will have an opportunity to learn about additional ways to get marketable title during my 2 Day Tax Deeds & Liens Field Trip. Remember when you are buying at the auction, there is no Inspection Period so all of your homework must be done prior to purchase. On the 2 day Field Trip you will learn how to do your Due Diligence, Tips and Tricks; mistakes to avid and more. Best of all once you sign up, you can repeat the field trip anytime you want and as many times as your want for FREE* (you pay approximately $39 for copies and refreshments). You also will receive a 2 manual home study course that contains documents you will need and 7+ hours of audio instructions. Sign up now, this class fills up at 12 people.
Happy New Year! I hope you rang in the new year with optimism, ambition and love. Now is the time to take advantage of the opportunities you may have neglected last year. As a person who buys properties at the tax deed auctions, I am in and out of vacant houses all the time. One issues that I am always asked about is security. How do you maintain your safety when you are in a vacant property? Because the house is empty there may be no one checking on the property to make sure vagrants, squatters or unwanted people stay out.
Tip#1
Is it a good idea to enter a vacant house alone? The answer is NO. I try to make sure I have someone with me at all times when I am looking at vacant properties.
What happens if no one is available to go see the properties with you? If no one can go with me the next best option I chose is to ask a neighbors that you already know. If you are alone nosey neighbors can work to your advantage. They are watching everything that is going on in the neighborhood and often they know more about that house then anyone else on the block. Picking the right neighbor is a judgment call because you don’t want to pick a person who may bring more harm than good. I always say hello and strike up a short conversation with the neighbors to let them I know will be in the house. When all else fails and no one is available I try to check in with a loved one to let them know where I am and the situation, that way they will check on me if they don’t hear back.
Tip#2
There’s also an app for that! Seriously, there is an app for your smartphone that was built for real estate agents but works just as well for real estate investors. AgentArmor is an app that puts mobile security in the palm of your hands. It has settings for showing properties, open houses, listings etc. The app allows you to record a voice memo of where you are, the vehicle description of who you are meeting at the property and even allows you to captures a copy of the driver’s license of who you are showing the property to at that time.
All the data is uploaded to the AgentArmor servers and in case of an emergency it is shared with your office, another contact and law enforcement. The app checks-in with you later and at that time you are asked to enter a pin to let it know you are ok. If everything is not ok, you tap call 911. If you don’t check-in the prescribed time period your emergency contacts are notified via text and email as well as the cops. GPS coordinates are sent so police can respond in case of an emergency.
This isn’t just for women… The app’s youtube video states that 30% of all crimes to realtors are committed against male realtors. You can download the app in the apps store on your smartphone or go to their website or youtube channel for details. It’s available right now in the Google Play and the Apple’s App Store.
Tip#3
Another important safety tip when you are inside of a home with someone you don’t know is to always maintain a direct access to the exit. Don’t let anyone stand between you and a door. If you have to flee the area you want direct access to the exits. Never let anyone stand between you and any exit in a house.
Tip#4
Beware of your surroundings and maintain a confident posture. Keep an eye out for potential danger. Beware of who may be watching you. The bad guys (or girls) see you coming long before you see them. Always make direct eye contact with people. Walk with confidence even if you lack it because people can sense fear. You know that saying, ‘fake it until you make it.’ That applies here too.
Tip# 5
I recently bought a keychain called the Munio self defense key chain. It was created by a martial arts instructor. It is a non-lethal and there are no legal restrictions so you can carry it anywhere. The keychain’s innocent and attractive appearance makes it easy to carry. If attacked you can use it a defensive weapon. There are similar products on the market place like the Kuboton.
Wishing you a Safe and Happy New Year! In addition to being the immediate Past President of CFRI, Sandra Edmond is also a Realtor ® and a licensed real estate agent with Matrix International Realty. She has been buying tax deeds & liens full time since 2004, a CFRI Success Team & Lifetime member and is known as the Queen Of Tax Deeds. Visit her at BuyingTaxDeeds.com or ArdnasInc.com for more safety tips and information.
Those of you who have attended the tax deed auctions are very familiar with that term. The clerks gives this warning at the beginning of very auction. For such a small sentence it carries A LOT of weight. Why is this that important? This can mean you the property you bought can and will be subject to: taxes for the current year, Federal Tax Liens, and Municipal and Special District taxes, if any. And possible other liens if the tax deed process was not conducted properly. This is why you want to make sure you are really buying what you are bidding on and you have fully researched the property and looked at a complete title search history.
Let’s say you make a mistake and catch it in time and decide not to pay for the property after you have bid. Well, if you are in Orlando the Orange County Comptroller’s rules clearly state, “The first time a bidder defaults on a bid, s/he will be banned for the next 12 months from participating in our tax deed sale auctions. If the bidder defaults a second time, s/he will be banned for three years.” At this point you might be thinking you can outsmart them and bring someone else to bid for you until your ban is lifted, WRONG. The rules go on to say, “If it is determined that the high bidder designates someone else to bid for him or her at future sales of the parcel which said high bidder defaulted on, said high bidder will be banned from future tax deed sales for a specified period of time. Additionally, the Comptroller may recommend legal action regarding any bidder who defaults at any time.”
Bottom line, it’s not worth the hassle to bid on property you haven’t done your research on.
Originally posted to Blog on 12/7/2012
14-yr old Florida Girl is a Landlord (…and maybe Fl’s youngest RE Investor) Willow Tufano was only 14 years old when she became a real estate investor. The Port Charlotte teen earned money to purchase her first investment home by taking out the neighbors trash and by selling on the website craigslist items she collected from the side of the road and thrift shops. Willow is not your typical teen that would have taken that money and bought the hottest new gadgets or the latest fashions instead she did something that many adults would have been too scared to do, buy investment property. She earned about $6,000 when she the – says she overheard her parents talking. “The idea came from out of the blue. I heard my mom and dad talking at the dinner table one night that there was a house on the market for $16,000. I said offer $12,000 and we can [split it],” Willow told a reporter at Knowledge @Wharton website. Willows mom and father in the real estate business. Willow brought her first home for $12,000 in January 2012 and then purchased another home in October of 2012 for 17,500. She was able to offset the repairs by using a $10,000 gift card she received from the Ellen Degeneres talk show host. Yes… her success has come with fame and landed her on the Ellen Degeneres talk show to tell the world about the adventures of this mini real estate mogul in training. Willow bought one of the through a short sale process. Willow is not only a investor but she is also busy being a landlord. She is now 15 years old and still collecting her items to sell and she wants to buy 10 more properties by the time she turns 18 years old. Willow’s mom, Shannon Moore is a Realtor and says, “I was skeptical in the beginning, partnering with a (then) 14-year-old, but she collects the rent, interviews contractors, tries to solve the problems,” says Moore. “She’s a great partner. She’s learning some great skills and it’s a good, practical education.” Originally posted to Blog on 12/5/2012
Three properties were auctioned off at an undisclosed Florida tax deed auction the last day of October. Take a look at how crowded the sale was as bidders nudged each other for room…NOT. This auction was more like a ghost town ironically on Halloween. Not a one person showed up to the auction. Despite the zero attendance the clerks in charge of the sale pushed their little cart with the files out at to the steps and began the auction anyway. Afterall it’s still a a state required tax sale whether or not there are bidders present… the auction must go one. By the way, all the three properties were vacant lots. What happens if no one bids on these properties? Sometimes they go directly to the tax certificate holder or they are put on a list that anyone can buy directly from after the sale. My first tax deed came off of one of those lists… we made $30,000 off it.
Originally posted to Blog on 11/5/2012
Some may call it a trick, some a treat but it’s that time of year when the property tax bills are in the mail. Broward County, FL Tax officials mailed out the tax bills on Nov 1st while counties like Orange County mailed the bills out on October 31st (Halloween). Just about all the county tax collectors are sending the tax bills out. Broward County Records, Taxes and Treasury Division has mailed more than 430,000 property tax bills for 2012, which must be paid no later than March 31, 2013 to avoid penalties and delinquency fees. Property taxes may be paid as early as November 1, 2012, to take advantage of discounts. A 4 percent discount applies to taxes paid in November; a 3 percent discount applies in December; a 2 percent discount in January; and a 1 percent discount in February. Property owners without mortgages, or those who do not make use of an escrow arrangement, may pay their taxes in person or by mail to any of the tax collectors throughout Florida. You can also make partial payments throughout the year but you have to contact the tax collector’s office to take advantage of the program. Find your tax collector’s office here.
Originally posted to Blog on 11/5/2012
Bloomberg.com reports that the Clerk of the Courts for Miami-Dade County, is suing Fannie Mae and Freddie Mac. The home mortgage-finance companies ,now under government control, is on the hot seat in the Sunshine State and few other counties across the US over the same issue. Clerk Harvey Ruvin filed the lawsuit in federal court on October 29th alleging Fannie and Freddie improperly claimed tax exemptions, which amounts to 60 cents per $100 of the value of single-family residences. Adam M. Schachter, a lawyer for the county, said in an e-mailed statement to Bloomberg.com, “Fannie Mae and Freddie Mac are parties to thousands of real estate transactions, particularly here in South Florida, and they are shirking their responsibility to pay their fair share of transfer taxes.” Brad German, a spokesman for Freddie Mac, and Andrew Wilson, a spokesman for Fannie Mae, didn’t respond to Bloomberg.com’s e-mail messages seeking comment on the lawsuit. The website also says the Miami-Dade clerk claims that tax exemptions for federal agencies don’t apply to Fannie Mae and Freddie Mac because, while federally chartered, “they are private corporations and not government entities,” according to the lawsuit.
Originally posted to Blog on 11/5/2012
Announcement: I will be teaching the, “2 Day Tax Deed and Lien Field Trip.” I thought the field trip in September was going to be the last one of the year time but we are holding one more by popular demand. This one will be back in Orlando and not the Ft. Lauderdale/ Miami area. You can still register and learn from an expert on buying real estate through tax deeds and liens.
The first day is in house as I teach you how to do your research and due diligence on tax deeds and liens. The second day we all travel to an auction and get hands on experience. It’s not too late to book your seat and join the rest of us for an awesome event. Details & Sign Up Here .
Originally posted to Blog on 11/5/2012