Mitch Goldstein | Coach Mitch | May 27th, 2009BARTOW | Friday is the last day to pay 2008 property taxes without incurring extra costs, according to Polk County Tax Collector Joe G. Tedder.
After June 1, tax certificates on the delinquent tax bills will go on sale, Tedder said.
Tax certificates are sold to aid local governments in recouping the tax money already budgeted but not yet received.
Tax certificates are liens that property owners must pay to settle their tax bills.
Investors can bid to receive interest rates of up to 18 percent, but the lowest interest rate wins the bid, according to state law.
Tedder said any investor who purchases a tax deed and holds it for at least two years from the date the taxes were due can apply for a tax deed, which will result in the sale of the property.
According to the latest figures, investors have bid on only 12,456 of the 36,847 tax certificates that are being sold this year.
As of last week, there were $56 million in unpaid property taxes.
Last year the delinquent taxes that are advertised annually totaled $38 million.
Tedder said he expected to hold a second round of bids this year, too.
In the second round, investors will receive 18 percent in interest on any of the tax certificates, which could spur more bidding if there are still attractive properties on the list, Tedder said.
He explained there is some risk in investing in tax certificates, the same as with any other investments.
‘It’s definitely buyer beware,” he said.
Tedder advised anyone interested in bidding to read the information on the Polk County Tax Collector’s Web site www.polktaxes.com first.
He said people can look at the list of properties available on the Web site without registering.
Registration is required only if you want to place a bid.
See entire article: http://www.theledger.com/article/20090522/NEWS/905239987/1338?Title=Pay-Property-Taxes-by-Friday-or-You-Pay-More
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Coach Mitch’s REFLECTIONS™
Buyer Beware!
The great state of Florida is a wonderful place to get tax lien certificates. Unfortunately, currently, it is not as great as it used to be. Therefore, your best course of action is to be very careful before purchasing a Florida TLC.
Hurricanes
What do hurricanes have to do with a decision to invest in tax liens?
We all know that the brass ring in TLC investing occurs after you have paid the delinquent property taxes and if the property owner does not pay you back, then you get the property itself – for the cost of the taxes.
The insurance companies offering hurricane insurance have increased their rates significantly. In fact, hurricane insurance is very, very expensive. I have heard of situations where people are paying $1500 for their property taxes, but are now paying $6000 for hurricane insurance.
Make sure you want the property
People do not pay their property taxes when there is some trouble or issue in their lives. Almost all folks resolve their situation enough to gather sufficient funds to pay the taxes, but sometimes they don’t.
In Florida, the system requires the TLC holder to hold an auction. The minimum bid is the taxes and costs due. The TLC holder is an auction bidder, just like everyone else. The opening bid is the amount of the outstanding taxes plus costs. If anyone bids, the TLC holder is required to bid higher, should he want the property. Any bid over the amount due is considered “excess proceeds” and is due the delinquent property owner or other parties who are due monies.
Know your values
I have heard many stories about the great deals that were had at these tax delinquent property auctions. However, the most important issue always is, make sure of your property values, and make sure you can execute your exit strategy.
See Coach Mitch’s “Ridiculously Simple System…”™ for details.
Happy investing,
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