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Tax Lien Sale Time

For Illinois and Indian this time of year tax liens go up for bid. Why does the county sell your property taxes easy, money. Everything that is on you tax bill needs to be paid like school, roads, and the city government. When you don’t pay the county and city’s don’t have money to run all the services they provide.

So written into the state legislation is the ability to sell non-paid property taxes to investors and investors get a interest rate here in Illinois it is 18% per payment thats 36% per year. Illinois has 2 payments a year I think they split it so you don’t know how much you really pay in taxes. Cook County where Chicago is gets reassessed every 3 years. The county is split into 3rds: They city, south suburbs and north suburbs. Each one is reassessed every 3 years moving from one to the other and back to the beginning.

Indiana is 10-15% per year. Not to familiar with how the counties work don’t have any real estate in Indiana yet. And each county is a bit different.

I was talking about tax liens right? Not how they get assessed. If you don’t pay for your first installment nothing happens only as it is not sold to investors yet. You still get a late payment and have to pay that. The taxes are not sold till after the property owner missed the 2nd payment.

I assume at most tax lien auction they give you the rules for the sale as well as what you can and can’t do. I have heard of people going to a homeowner and telling them they have to move out after they but the lien. ITS A LIEN!!!

There are a few things i don’t like about tax lien sales it that at least in IL it is bid down. Meaning at auction you have a screen with 1-18 on it and you press a button. That is the amount on interest you will be paid. For only they second payment. the other is that if the first missed payment the investor pays the county 18%. Oh and the lowest bid wins the lien 0-2% is normal.

Cook County is done this year, next some of the collar county are still to come and Indiana is coming up over the next few months.

Tax liens can be a good investment but the odds are against you to get the house. Yes you can get the property after the redemption period passes but about 95 redeem prior to that. When you go to redeem it is a  foreclosure and you have to follow the law and give the right notices in the allotted time if not you can be out your investment.

If tax liens are something you are interested in attend an auction live or online and just observe. Also get educated to understand how it works.

 

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