Investing in Tax Liens From Afar

Lately I've been receiving messages from subscribers in other countries - from Canada, Australia, New Zealand, and even from parts of Africa, asking if it is possible for them to invest in tax liens and tax deeds in the U.S. market. They want to know if they can actually do come from another country or, in some cases from other continents. And the answer is yes you can, but there are some provisions.

First of all, not every state has an on-line auctions, but few do. So, first you need to know which states have started online and determine where to invest. Next you need to get sales tax information, which is pretty easy to do, and can be done with computers. You will then need to register for sales tax and make payments online auction company - this can all be done online. If you are investing in tax liens will need to fill out a Form W-8BEN, which can be found online at www.IRS.gov.

OK, now here comes the hard part - you need to do your due diligence on tax sale property before you bid on them. Contrary to what you May have heard, there are risks involved in investing in tax lien certificates and tax deeds, and how to avoid risk is to do your due diligence on the properties. Some counties make this easy by providing lots of information on the Internet. In some cases you can get an estimate of the data, maps, pictures and even real estate. And there are other online tools you can use to help you find out what the property is worth, as well as realtor.com zillow.com. And you can check the status of the environmental Web site to learn about all the environmental problems that may exist, and check with the municipality for any zoning requirements. All this can be done online and by phone.

For tax liens to a fairly simple process, but the tax deed to a little more involved. If you are purchasing tax deeds, then you are actually buying the property, and you'll have to do more due diligence than they would just buy the lien. You have to make some type of title search to learn about mortgages, or cargo that may exist in any properties that you wish to bid. And you will need to make sure that any lien-holders were informed about the tax sale, usually May they have the legal right to purchase the property back from you if they believe they are not properly informed of the sale.

This May not be so easily done in other states. This is the place to be real helpful to work with someone who could look at the property for you and do some research. It would be ideal if you had a relationship with a realtor or title company in the area who could do some of the legwork for you in exchange for your business when you actually buy some of these properties. After all, you will need the name of the company to delete the title for each property and the realtor for the sale or rental properties for you after you own them.