Alabama Tax Sale Investing

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Alabama Tax Sale Investing by Mind Map: Alabama Tax Sale Investing

1. No?

1.1. No worries. We are excited you are interested in buying a tax certificate or deed. First we need to cover the basics for you to know the risks and rewards that come with tax sale investing.

1.1.1. Rules before we start. 1. This is an investment - don't use your rent money. 2. Expect the owner to redeem. 3. Don't fall in love with the house. Why is this for sale? When someone doesn't pay property taxes the county still needs the money to operate, so they list the property in the newspaper for auction. After 3 weeks of being listed in the local paper, they auction the property (tax certificate) somewhere around May. Timeline After the sale a receipt is issued by the county (they hold the certificate) which allows possession IF the property is abandoned. After 3 years the tax purchaser files with the Probate Court (minimal fee) to have the certificate changed to a deed. Cert Vs. Deed They are very similar: The main difference is that all legal fees are covered with a deed, with a cert the legals are covered only if you file the ejection first/ start legal first. What happens when the owner wants to redeem? Cert: The owner goes down to the courthouse and requests a redemption letter - they must send this to you via certified mail, you MUST reply in 10 days or you lose the right to any fees which are due. Once the owner pays the requested amount you sign the paper and return it. The owner pays the county the back taxes plus interest and the County mails you a check. Deed: When the owners wishes to redeem they must come directly to the tax purchaser (you) for the redemption amount, which includes the following: back taxes + interest, preservation improvements + interest, insurance + interest, legal fees + interest. What are they required to pay? 1. Any taxes that have been paid. 2. The value of the preservation improvements (and when we say "value" it means how much the property value increased. As an example, the house is worth 100k retail, and the house is worth 30k in its current state, and you make the improvements and bring it back to the retail value, they would need to pay the 70k as it is the improved value). 3. Any insurance paid . 4. Legal fees. How do I know the value in its current state? 1. BPO (Brokers price opinion) We recommend this option for houses 100k and less. Cost runs around $200 2. Subject two appraisal (this is the current value of the house and then it's value/worth once repaired). These costs 400-500. The idea from the start is the build a case should you need to go to court to either get the house, or insure you get all your investment back. What is the difference between a set price and open bidding? On some properties there are only 1 or 2 buyers, thus the amount listed is the minimum. However, sometimes there are really good properties which become available, and to be fair to everyone, we open it up to bidding (generally more than 5 or more people asking about it or wanting to move forward at once). How do I move forward? Awesome. Head over to and fill out the form Bid - if bidding please include your bid amount with the above information. What is your goal for the property? Investment - Non-Active Investment - Active Investment - Rental Investment - Live In What happens to the other liens or mortgages? Depending on what direction you take (see Investment Categories above). When a quite title lawsuit is filed you remove all the liens and mortgages, much like a foreclosure does. There has been times that we want to strength our position and will buy out say the HOA lien to make the redemption amount for the tax payer more or too much for them to redeem. What if I am out of state? No problem. We offer remote signings along with wiring instruction to send funds We also provide contacts for those that can help with; Legal filing Ejection Quite Title Clean outs, Contracting Leasing Agents When can the owner redeem? The owner can redeem until one of the following happens:

2. Have you purchased tax properties before?

2.1. Yes

2.1.1. Awesome. Please email [email protected] Name (Individual/Entity (name to transfer tax certificate/deed) Mailing Address (Next years tax notice will be sent) Phone Number Email Address Once we receive the info we will send you a confirmation email to insure we have spelling correct. Then we will set up appointment to sign and finalize paperwork.

2.1.2. Looking for more info? We are here to help. 1. Please read through this whole document. 2. If you still have questions. You can call our office at Anderson Realty Group LLC Monday - Friday 9am to 4pm 205-235-1050