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Who's on Your Tax Lien Investing Team?

Are you feeling overwhelmed? Have you been wanting to start investing in tax lien certificates or tax deeds but don't know where to start. Every successful endeavor requires a support team. Tax lien investing gurus make it sound so easy, you just go to the tax sales and buy a lien or a deed. But it's a lot more complex than what you here about in those tax lien seminars. In fact, it takes a TEAM to be successful at tax lien or tax deed investing. So who is on your tax lien investing team?

You, the investor, are an important part of your investment team. You are the person who does the due diligence and purchases the tax lien certificates or tax deeds. You may be doing this all by yourself or you may hire someone to do the due diligence and bid at tax sales for you. You are the one who is making the decisions of what tax lien certificates or tax deeds to buy.

Your Title Searcher. This can be a title search company or an idividual who does your title searches for you. Their job, in the case of tax lien certificates is to check on the title of the property before you start foreclosure procedings. In the case of tax deeds, since you are actually buying the property, you may want them to do a title search before you bid on a property at the tax sale. You definitely need someone who can research property titles for you regardless of whether you are investing in tax lien certificates or tax deeds.

If you are using a title search company, there are different levels of title searches for different prices. For tax liens, you may only need the simplest and cheapest search. If more detailed searches are needed during the foreclosure process, your lawyer can order them from the same title company. Sometimes you may want to use different title companies to do different types of searches on the same property.

Your Lawyer. Most tax deed states do not issue a "warranty deed". This means that you will have to clear the title of the property before you can sell it to someone else. I recommend that you have a lawyer for this purpose. Although it can be done without a lawyer, if you miss any deadline or notification, you could loose your right to the property. The same goes for the foreclosure process on tax deeds. Although there are a few states that make this process easy for you, in most states this is a prcess that you'll want to have a lawyer take care of for you. It's best to get a lawyer that specializes in tax lien foreclosures, otherwise the process could take longer and cost you more money that it should.

Your Rehabber. Properties bought at tax sales are often neglected. Typically if a property owner is not paying the taxes on their property they are not keeping up any maintenance on the property and it may be in bad condition. If you aquire a property through a tax lien it could have been neglected for a long time since you have to wait out the redemption period before you can foreclosure on the property. Unless you know how to do the fix up yourself, and you have the time to do it, you'll need to hire someone to do this for you. Your Realtor. Once you've acquired a property, whether it be from a lien or a deed, and you've done the rehab, you'll need to sell it or rent it to make a profit on your investment. If you don't have many properties and you have the time, you may want to do this yourself. However, if you are busy buying more tax liens and/or deeds, you may want to hire a realtor to do this for you. This will free up your time to spend on pursuing more profitable investments.

Other members of your successful tax lien/deed investing team may be your office manager - someone who can take care of all of your paperwork, such as recording liens or deeds with the county and paying subsequent taxes. Your bookkeeper and your accountant. These are things that you may want to do yourself or hire a professional to do depending on how many liens or deeds you purchase each year.

Regardless of whether or not you've ever outlined all of the activities that are involved in creating, and maintaining a profitable tax lien or tax deed portfolio, they do all exist. And if you've been wondering why your investments are not as profitable as you'd like them to be - it could be you've left out an important function and/or member of your tax lien investing team.

About the author:

Joanne Musa is a tax lien investing coach who works with independent investors who want to learn how to make profitable investments in tax lien certificates and tax deeds. Ms. Musa is the author of Tax Lien Lady's e-books. Her e-books are available at http://www.taxlienlady.com/store2/sales.html. For more tips about tax lien investing send an e-mail to MoreTips@taxlienconsulting.com

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