One investment niche gaining popularity in the US is the purchase of property tax liens. The stock market volatility and low interest rates have spurred investors to look for ventures with impressive returns, and tax liens investing can yield 12 to 18% return on investment (ROI). However, without a reliable Maryland tax sale attorney on your side, these transactions can lead to catastrophic losses.
This article will discuss details about tax sale foreclosure Frederick MD investors should know. We will share how the process works and how you can find success in this financial endeavor.
How Does the Tax Lien Process Work?
A tax lien is a legal claim that the government places against the assets of an entity that fails to pay taxes. In Maryland, property owners with delinquent tax payments receive a notification on the possibility of a tax foreclosure sale at least 30 days in advance. Only if they fail to make payments can designated agencies publish their properties in newspapers.
Upon lien issuance, the municipality creates a tax lien certificate reflecting the amount owed on the property plus corresponding penalties. Afterward, these lien certificates are put up for auction and are awarded to the highest bidder. As lien owners, investors can collect payments with interest from the property owner if owners seek to redeem the property.
Purchasing at a tax sale foreclosure does not mean the investor automatically owns properties; instead, the state gives the owners six months (sometimes more) to redeem them. During this time, they can pay their tax liens and regain their assets from the certificate holder.
In some occasions when asset owners default on payments, the investor may foreclose and obtain the property title.
The Benefits of Tax Lien Investing
Tax lien investing has taken the real estate industry by storm because of its many advantages. Below are some of the most notable ones:
Passive Initial Investment
Before investing in tax liens, we recommend a significant amount of research upfront. However, investors don’t usually have to attend in-person auctions or actively monitor their certificates to earn from their investment. Instead, they can work with a Maryland tax lien attorney to achieve their targets.
Low Capital Requirements
Contrary to popular belief, purchasing a tax lien doesn’t require massive capital. In fact, you can win bids for a certificate for a few hundred dollars. It’s the ideal way to diversify your investment portfolio.
High ROI Potential
As mentioned earlier, tax lien investing can yield 12 – 18% ROI. For a potentially passive investment with low capital requirements, this range is impressive.
Work With a Maryland Tax Sale Attorney Now
Naturally, tax lien investing comes with risks. Purchasing a tax sale lien certificate could be a lucrative venture — or a devastating failure.
Having a reliable Maryland tax sale attorney can be all the difference you need to grow your investments. At LewisMcDaniels, we have best-in-class lawyers who can help you analyze all of your options and maximize your profits. Call us now at 301-818-0405 for a free consultation.