Hooked On Overages is the original course by my friend Rick Dawson on how to profit from finding people that are owed tax sale overages.
Let me explain…
When a property is sold in a tax deed sale, the price is bid up at the sale. The bidding may start at the back taxes and penalties, but it is bid up from there. Did you ever wonder what happens to the tax sale overage? That’s the money in excess of what is owed to the county. For example if the minimum bid amount is $2000, and the deed is bid up at the tax sale to $20,000, what happens to the $18,000 overage?
In some tax deed states this overage is given back to the original owner of the property. it’s considered compensation for the loss of his or her property. The owner usually has to apply for it and may have to wait for a period of time in case any lien holders (like a mortgage company) apply to receive the overage. Since most delinquent taxpayers do not know that they are entitled to this money and they may have abandoned the property and have moved on to another state, this money frequently goes unclaimed.
Counties are generally not concerned about finding these people because they usually have a limited time that the property owner can receive this overage. Once that time period expires, the county will take the money for themselves. The term for this is “escheat.” The definition of escheat is “the reversion of property back to the state when there are no heirs.” So in some states, if the owner of the property does not come forward and claim the overage, it is taken by the state or by the county.
The Hooked On Overage course shows you how you can make large finders fees by finding these people and helping can the money that is owed to them from the county. Want to find out more about how to make money from tax sale overages? Watch a free webinar hosted by TaxLienLady.com with Rick Dawson of Hooked On Overages. You can get the video at www.TaxLienLady.com/WebinarTraining/TaxSaleOverages.html.
Have questions? Leave your comments below.
By Eugene March 29, 2012 - 6:28 pm
I have been trying to get the escheat list here in the state of georgia and they give you the ultimate run around i have even gotten calls back from the tax commissioner and other state official saying they don’t know or the have never herd of that who is the right person in the state of georgia.also georgia is a non judicial state so that info would not be in the mortgage files.
By Joe Piccirilli March 12, 2012 - 10:34 am
Rick,
Thanks for the interpleader clarification.
By Rick March 10, 2012 - 5:31 pm
You are not going to learn how to do this on a forum. Take Rick’s course Hooked on Overages and learn how to do it the right way. Then take the time to read the state laws where you want to work. You can google the statutes and read for yourself. This is a good, but tough business. I work as much as 12-18 hours a day fairly consistently and am very successful because I studied this stuff just as if it were some graduate course and learned how to overcome the obstacles–there are many. You have to take some personal initiative because most people are not going to give away the secrets that they have learned through hard work.
By Rick March 10, 2012 - 5:25 pm
Regarding counties in Alabama requireing a release:
This is a real problem in Alabama in select counties. The counties know that you cannot get this. Finally I have cracked that code and have developed my own private package of documentation to handle that issue. I cannot do this process in any other state YET though. At least now, I can go back and get all those cases that are denied because of the release form and make the county pay now. This helps a lot because Alabama has been overwhelmed with so many new finders that business became very tough.
By Rick March 10, 2012 - 12:38 pm
First of all, the claimant is not a third party, and you are making the claim on their behalf. So it shouldn’t apply to you. It’s referring to banks and other lienholders, or parties not of record who are trying to get the funds.
Let’s assume for the moment that the county interpleads all surpluses though, or that they consider you a third party even though you’re acting on behalf of the claimant who is a primary party.
This means you must claim all petitions in court. So there is no way you can force the county to process your claim administratively.
Counties do this because they do not want to be liable for deciding who gets the funds. If they pay the funds out to the wrong person they could be liable. So they make a blanket rule that the judge will decide.
These petitions can usually be done without an attorney appearing in person. So they can be economical, as little as $500.
I wouldn’t start out your very first claim with this added step being necessary. However, once you do a couple, don’t let interpleading requirements scare you off.
In fact it will give you a tremendous advantage in those counties if you will be one of the few to take the time to locate an attorney to process them economically for you. 90% of finders will move on immediately upon seeing the interpleading requirement.
The petition is literally one or two pages that can be made into a Microsoft Word template, with the information dropped in. Then a matter of noticing any other parties involved in the case and the judge reviewing it.
By Joe Piccirilli March 9, 2012 - 2:42 pm
It is the policy of Tax Commissioner of Cherokee County in Georgia that all third party requests for excess funds will require an interpleader to be filed with the Superior Court by the Tax Commissioner. Excess funds will be deposited in the court’s registry for distribution by orders of the court.
I also have seen this restriction in a couple of more Georgia counties. Is there a way to work around this restriction??
Thanks
By Barry February 24, 2012 - 8:27 am
Thanks Rick. I honestly don’t know what the penalty is for not issuing 1099’s, but 1099’s are a CYA for the issuing company so I would suggest issuing a 1099 for any check issued to a client for $600 or more.
Barry
By RIck February 23, 2012 - 3:10 pm
Barry,
Yes, I think you should be giving 1099’s to people who you pay funds to. It’s income to them, but perhaps not taxable for various reasons. That’s for them to figure out. If you’re a CPA, you know better than I what the nuances are.
If you need their social, ask them for it as soon as the money comes in. They will give it to you. If they won’t, just don’t 1099 them. I understand there is a maximum penalty of $50 per incident, to fail to 1099 someone.
I just file tax returns in my state and report the income I receive, no matter where it comes from.
By Barry February 23, 2012 - 9:37 am
Rick,
One more question – you mentioned that counties often give you/your company 1099’s. It appears to me that you work in states other than just the one you reside in (Indiana I believe). Do you/your company file tax returns in all of the states that you materially participate in? If not, is it just a calculated decision to take a risk and not file in those states?
Thank you.
Barry
By Barry February 23, 2012 - 8:11 am
Rick,
That last comment was from me (Barry), not someone name Rick (that’s you!).
Barry
By Rick February 23, 2012 - 8:03 am
Rick,
In regards to my 1/15/12:
I actually am a CPA. However, I am never planning on giving professional advice to a claimant. What I am trying to figure out is whether MY company should be issuing 1099’s to people who we help collect overages for. My only concern with the 1099 process is asking the claimant for their social security number – I think maybe what you’re referring to when you are talking about having them sign something is a W-9? Again, I don’t really care if they sign a W-9 or if they give me their social security number over the phone. One way or another to issue a proper 1099 you need the payee’s social security number (or federal ID if it’s a company and not a person).
So my question is, at what point do you ask for their social or federal ID? How do you go about asking for it without making the claimant wonder if this is just a scam for me to get their social security number? I don’t love the “hold their money until they give it to us” idea – are there any other methods you know of?
Thanks.
Barry
By Chris February 5, 2012 - 9:07 pm
How much money will I need for capitol after I purchase your product?
By Dustin Terrell February 2, 2012 - 4:21 pm
Rick,
Thanks for the update and the information on the Michigan tax foreclosure system. I know now what I need to do to refine my approach to get some deedgrabbing done prior to the tax deed auctions.
All the best,
Dustin
By Rick February 2, 2012 - 11:19 am
So if you’re trying to buy properties before the tax sale, you cannot use a tax deed sale list to find the properties. The county already owns the properties by the time that list comes out.
If you want to see the Michigan tax sale system in all its “glory”, check this out:
http://www.co.wayne.mi.us/documents/taxRevisionChart.pdf
Only government could create a monster like this.
By Rick February 2, 2012 - 11:16 am
Michigan really does have some of the most unfair laws regarding their tax foreclosure system.
Because of the way things are set up, there are no overages available to the owner under any circumstances. Here’s how it works:
1. Property begins approximately 2 year tax foreclosure process
2. A warning of foreclosure is given
3. Property is foreclosed by the county
4. County now owns property and it cannot be redeemed later.
5. Some time later, the county sells off the property in a tax deed auction (or the city gets it apparently).
Either way, it’s the government’s property because they foreclosed on it in step 4, without any kind of public bidding. So they could sell the property for $1 million and they would get to keep it all – it’s “their property”.
By Dustin Terrell February 1, 2012 - 6:02 pm
Rick,
I like what you’re doing with investing. This discovery of recovering tax overages is awesome. I recently conducted a ton of research on a tax deed property here in Michigan and was all set to buy the house at the county auction (this was before I knew about deedgrabbing) only to find out the property wouldn’t be auctioned that day because the city has the right to buy it from the county before the public auction! Long story short, I tried to obtain the property from the city at their silent auction and lost it to an end user buying the property as a personal residence and missed out on $39,080 in profit! (That’s what led me to deedgrabber.) I contacted the city to find out what they’re plans were for the overages and they ignored my questions (this is what led me to hooked on overages). Now that I know overages can be recovered, do you know if it’s possible to recover overages in Michigan? If so, can you recover overages from the city as opposed to the county? I really want to stick it to the city and help the previous owners out! 🙂
Thanks,
Dustin
By Rick January 26, 2012 - 10:19 am
Brittani,
Generally, yes, it depends on which state you’re talking about. I noticed you were asking earlier about Missouri. Read the statute that discusses payment of the surplus and make sure it says “to the owner of record at the time the tax deed was issued” or something similar.
Also see if there are any additional requirements you need to fulfill if the property was transferred during the redemption period.
I’m not intimately familiar with Missouri. But for example in Indiana you have to file a special form with the deed or you cannot collect. I’ve also seen states where the surplus goes to the owner of record when the tax sale list comes out, not to the owner at the end.
By Brittani January 25, 2012 - 5:02 pm
Rick,
If I am approaching the property owner to buy the property before the redemption period is over, does that entitle me to the surplus if I let the certificate owner get the collectors deed (quitclaim deed)? Since, in this case, I am technically the “owner that lost the property”…
By Rick January 23, 2012 - 10:36 pm
Missouri does have tax overages, I forgot about that!
By Rick January 23, 2012 - 10:36 pm
Andrea,
We try to determine what they call their overage list locally, then request it via public records request.
Yes you have to wait to see if the property redeems in most states. In Alabama I think I’ve heard students collecting the money beforehand.
You usually do not have to piece together a list, but sometimes it’s your only choice. The county needs to be able to check whether a surplus exists before paying it out, so where ever they check that, there you go!
By Rick January 23, 2012 - 10:34 pm
Steve, details like that can usually be obtained from a local title company for very little $.
By Rick January 23, 2012 - 10:33 pm
Dave, Hooked on Overages is not a personal coaching program. If you think you won’t be able to learn from a webinar, then this program is probably not for you.
Our phone number is 800-528-9149 and can be found on all my sites.
We do respond to your forum questions if you’ve searched for an answer and found nothing.
By Dave January 23, 2012 - 4:20 pm
Rick, How do I get in touch with you for questions? The last time you answered any question on this site was Jan. 16th today is the 24th. On your company site I see no phone number, blog or email for questions. Most of the info. I see on your site is 2011. I really want to get started however, I’d feel more at ease knowing I can have questions answered on a timely basics, I feel alittle fustrated that I can’t start this system without real communication. There is just so much you can learn from a webinor.
By Steven January 18, 2012 - 8:07 pm
Hey Rick,
I’m so relieved to have found this site!
After I obtain a overbid list from the county via mail or email.
Regarding Claim form for Tax sale overage.
I’ve seem the overage form online theses are some of the questions I wasn’t sure how to get
A) Map ref # of property
B)Tax Sale Item # and year of tax sale
c)Name and address of any Mortgage or lean holders on property.
D) Deed book and Page Number of the Tax deed.
Without viewing the ENTIRE physical file from the court house or doing a title search and having the deed. How would I know if there are any remaining mortgage leans, promissory notes etc. on overage fund? As well as the other above questions.
By Andrea January 18, 2012 - 7:30 pm
Hello Rick!
What do you say to the county officials when you want a copy of the list of overages?
In tax lien states do you have to wait to see if the property redeemed before claiming the overage?
Do counties have lists that have “all the work done for you”, or that state the overage, or do you have to request records from previous tax sales and compare it to lists of delinquent properties and their starting bids to figure out if there is an overage?
Thanks for your time and advice, I appreciate it 🙂
By Stacey January 18, 2012 - 7:18 pm
Hi Rick,
A couple questions:
1. Are the excess funds, surplus funds, and unclaimed property lists the same thing as the overage lists, or overbids from tax sale lists in GA (or in general)?
2. I read the state statute for GA, and I’m not sure if I’m understanding it fully — the excess funds, can they be fully claimed using a POA with the owner (as long as the mortgage company/lien holder has not already), and is that entire claim amount free and clear? Or once the claim is filed for the excess funds, is there a possibility that the property/owner has encumbrances that need to be paid off to mortgage/lien holders that will be deducted from the excess claim amount?
3. I’m not sure if my terminology is correct when requesting the list of overages/overbids from the counties…specifically NC. I keep getting a response that no such list exists, and that only foreclosure excess proceeds are handled by the Circuit of the Clerk. Do I need to check of there are any fees/liens that need to be paid off on the property before claiming the excess foreclosure proceeds?
Thanks so much for all your help!!
By Brittani January 16, 2012 - 5:30 pm
Thanks Rick,
I thought Missouri was on the list of tax lien states that has overages?
By Rick Dawson January 16, 2012 - 5:16 pm
Brittani,
Most of our students never use an attorney to do deals. We may caution to see one before doing the first deals, but that’s really so nobody can blame us for their legal blunders.
Your account of how the process goes is good. Just remember, there are only a few tax lien states (IN, AL, SC) that have overages, and IN has a new 10% finder fee limit.
By Brittani January 16, 2012 - 3:33 pm
Rick/Joanne,
I am just getting started. I am still doing my homework and getting my documents together. I read somewhere that after I get the claimants to sign the contracts and get them notarized that I will need to submit them to an attorney. Is this correct, if so why wouldn’t I submit them to the county agency directly?
My impression in a tax lien state was get the list, find the customer, get documents signed and submit the claim to the county agency holding the funds (in short). I thought the only reason I need an attorney on hand was to initially draw up contracts and then if any issues arise in the future.
By Rick January 16, 2012 - 2:04 pm
I’ve never seen the mortgage company come after the owner for the money. I’m not too sure that they’d have a claim against them, but who knows.
By Rick January 16, 2012 - 2:03 pm
Cindy,
I really recommend you research the law thoroughly or better yet, get involved with Hooked on Overages. We give you 50 state guides to overages and getting public records.
There are some “landmines” you don’t want to run afoul of in this business.
In Texas you can only make 10% of the claim or $1000 whichever is less. So it’s entirely unprofitable to work the business there. This applies to finder fees AND assignment, there’s no known way to get around it.
To answer your question in general, most areas will pay the surplus to the owner, even if there are mortgages on the property, unless the mortgage company claims it first. Florida is the only state I know of where all liens must absolutely be satisfied before disbursal of the surplus. Counties in other states may have adopted that rule as well.
By Cindy January 15, 2012 - 6:23 pm
Rick,
Texas tax deed state: When a property goes on the unclaimed excess proceeds list and the county has tried to locate two mortgage companies (mail was sent certified but no one replied) and the claimant (no reply either). Will the ex-owner get all of the overage proceeds and the mortgage companies get nothing if the ex-owner shows up to claim first. Then what happens to the mortgage companies? Will they have any recourse to claim the proceeds from the ex-owner once he’s claimed the overage funds. (This is a straight buyout of rights & not an assignment deal.)
By Rick January 15, 2012 - 3:59 pm
Don’t assume that the claimant doesn’t have to pay taxes on the overage they receive because they “lost their investment”. What if they have purchased the house for no money down a couple years prior to the sale, and got a $100,000 surplus.
I guarantee you there would be tax consequences to that. That’s why you should stay away from advice on that, plus it almost never comes up as an objection from the claimant.
By Rick January 15, 2012 - 3:57 pm
Barry, I really think it would depend on the claimant’s situation as to whether they would need to pay tax or not, and unless you’re a CPA (I’m not) I really stay away from giving them advice. People have never turned down money because they have to pay tax on it.
Answers:
1. Your company COULD get a 1099, many counties never do it. I’ve gotten quite a few over the years, for the entire amount they paid me.
2. To be totally safe you should 1099 them as well. I only bother on large amounts and my accountant tells me that my liability is a possible $50 fine for not 1099’ing someone, because reporting income is ultimately the duty of the taxpayer.
By the time you have to ask them to sign the 1099, you will have the money. Just tell them if they don’t want to sign it, you’ll just put it in the bank until they change their mind. They’ll sign it.
By Barry January 15, 2012 - 10:41 am
Rick/Joanne,
Is the overage received taxable to the recipient? Here is the scenario I am wondering about:
Let’s say I am in Indiana and I get a property owner to quit claim the property to me before the property is foreclosed on in the normal course of the tax lien cycle. My arrangement with the owner is that I will get 40% of the proceeds of the overbid and will issue the owner a check for 60% of the proceeds from my LLC (which I own with several other investors – i.e. not a disregarded entity). Questions:
1. Will my LLC receive a 1099 from the county for the sum of the overbid proceeds that I have collected? I think regardless we would have to report the proceeds as income but I am curious. More importantly….
2. As I stated above, my LLC will cut the now former owner of the property a check for the 60% of the proceeds he/she is entitled to (let’s assume the proceeds are for more than $600). Will my LLC have to issue that person a 1099 or are we exempt from issuing a 1099 since the surplus funds are really a return of the original owner’s original investment in their property? If we do need to issue them a 1099, how do you typically explain to the owner that we need his/her social security number for the 1099 without them thinking that we are scamming them (which we obviously are NOT doing)?
Thank you for your help!
By Rick January 14, 2012 - 3:53 pm
A couple clarifications above:
The county won’t have a list of overages if no tax deed sale has happened in the past 365 days. That’s because they either distributed it or the money escheated (got lost to the county) – overbids are only available 1 year.
Tax deed sales results – I should have said “minimum bid/ACTUAL bid”.
By Rick January 14, 2012 - 3:51 pm
John, get a list from another county in CA (a few are online I believe). Not only so you can get going, but then you can say “Here’s what I’m looking for. County A in California has one. County B in California has one. Here are copies.
Make sure there was a tax deed sale held in the past year – otherwise they DON’T have one because they only hold them 1 year.
Also, if you can just get the tax deed sale results with minimum/maximum bid, you can figure it out yourself.
Finally, I have to warn you that many big CA counties are dipping into the funds to meet expenses and are handing out IOU’s to successful claimants! Not good for cash flow (yours, that is).
By John January 13, 2012 - 7:38 pm
Rick, Thank you for all the directions and suggestions, great advice.
This is kinda crazy. I am asking them for the most recent claimants list and they are playing a great job acting stupid. Am I asking this correctly or is my terminology incorrect. Should have a list with TMS, Name, Address, city/state, bid, Balance , and property address. Sorry to keep questioning you but I think I am getting the major runaround. And of course everyone is off till Tuesday.
By Rick Dawson January 13, 2012 - 5:29 pm
Brittani,
The lists of overages are always public record. The only difficulty you can have in a couple states, is that they don’t have to release names and addresses if they are going to be used for a commercial purpose. In that case, get all the information you can WITHOUT the name and address of the claimant, and figure out a way to develop that information in other ways (like looking up past owners of the property online).
I’m not aware that this problem occurs in MO.
Overages occur at the county level so you will not see anything about them at state-level agencies. Also you will rarely find them online, they have to be requested by phone, email, or mail.
By Rick Dawson January 13, 2012 - 5:26 pm
Don, you typically need to fill out a claim form, which the county provides, when submitting the claim. If the county wants a copy of the deed, that’s easy to get. If they don’t have document access online yet, just call a local title company and they’ll get it for you for $20 or so.
If you have claimants signed up but you can’t make the claim for some reason, I’ll refer you to someone who does a lot of business in Alabama.
By Rick Dawson January 13, 2012 - 5:24 pm
John, I’ve often had success working with the county attorney when this happens. Even though it may not be their responsibility to police these public record requests, they often call the department you’re having problems with, and set them straight.
Also see if your state has a public access counselor (or equivalent) like this:
http://in.gov/pac
By Key January 13, 2012 - 4:20 pm
What happens if the property is no longer owned by the original purchaser from the tax sale? Who then becomes entitled to the surplus?
By Brittani January 13, 2012 - 4:05 pm
Hi Rick,
I am getting started in Missouri. I am trying to find out if the overages from the tax sale are public information or not? I am getting the run around from a few counties. If it is public information would it be from each county tresurer office or from a state treasurer office? The searches I have done on the state treasurer website does not show the tax sale overages which makes me think its not public record?
By Don January 13, 2012 - 1:10 am
Hey Rick
I reside in Alabama and I was wondering if I need a copy of the deeds and to fill out a application in order to receive funds. I feel they may have been trying to baffle me. Do you know where exactly I go to fil these claims in Alabama, because I’m on track. I have the info and overages, but need to know where to file immediately. I’ve even found several owners, Ready to go!
By John January 12, 2012 - 7:36 pm
Thank you Rick, I will keep you informed. As of today the treasurers office has ignored my request and I am heading up the ladder tomorrow.
By Rick January 12, 2012 - 1:21 am
Cont’d
There are harsh consequences to ignoring a valid public records request, and people high up know it.
Sound like a pain? When you get the list there is probably nobody else who went through all this hassle so it’s all yours. Well worth it.
By Rick January 12, 2012 - 1:18 am
John,
I haven’t heard that. “Abuse” is not a valid reason to deny a public records request that is otherwise legal.
Here’s the thing: agencies are run by people, and people can tell you whatever they think they can get away with. They may even personally believe that denying your request is the “right thing to do”.
Public employees making $30k per year often do not see the high value of your service because they may have to pay you $30k or more on just one deal. They easily convince themselves that you’re “ripping people off”. Nevermind that if it weren’t for you, the claimant would get 0 and all the money would be lost to the state.
Don’t lay down, continue to put on the pressure and move up the chain of command at the agency. Demand precise, exact reasons why your public records request is being denied, backed by state statutes that allow the denial. You’re entitled to that by law.
When they inevitably can’t provide those citations, and you’ve moved sufficiently high up the chain of command, it will not be worth it for that employee to suffer the consequences of denying your request. Those conse
By Rick January 12, 2012 - 1:06 am
Jerry – Getting claims assigned to you is an advanced strategy. We have a specialty course about that at http://www.claimgrabber.com. However, it builds upon knowledge you will need to get in the Hooked on Overages course, so you have to be a graduate.
The second part of your question is completely different. The answer above pertains to overages that already exist.
The strategy or getting properties by Quitclaim Deed, letting them go to tax sale, and then claiming any overages created is also an advanced strategy. There is a course about this by a friend of mine (and Joanne’s) and I believe it’s a standalone course. If you want to get it I think it’s $697 and Joanne can help you get it.
If you were successful getting a quitclaim deed for a property and it sold for more than the amount in taxes, you should be able to claim the overage as the owner, because you were the owner who “lost” the property. No contracts involved, just a straight up claim by you as the owner.
If you want to work with claims that already exist, then you would either need to set up a finder fee contract or get the claim assigned to you, these are covered in Hooked on Overages, and Claimgrabber, respectively.
By John January 9, 2012 - 6:47 pm
Joanne/Rick, I am in Ca. and called the OC treasures office requesting the most recent claimants list, they proceded to tell me that the list is not avaliable to the public because of abuse. Is this true and is it legal for them to hide or not disclose this info and is there a way around this. This would hurt the owners if the state does not allow an outside party to help them recover the overage funds. Any comments or suggetions??
By Jerry January 7, 2012 - 4:18 pm
Thank you Rick and Joanne for so freely sharing your experience. How would I go about buying out or having assigned an overage in Georgia. I’m looking to purchase properties up front via a Quit Claim deed for less than the overage and take claim of the full amount. Is this possible and if so can I do this with a contract or do I need to go through the courts?
By Rick Dawson January 5, 2012 - 6:53 pm
Cindy, Texas is one of the few states that buttoned up the assignment strategy as well, as far as I know. Just need to work another state.
Myron, Georgia is great. However you shouldn’t limit yourself to your home state.
Kh, there are no tax sale overages in MI. You will not be working your home state anyway, everything is done without leaving your home no matter where you work the business.
By Kh January 4, 2012 - 8:58 pm
Thinking about buying it in Mi… What experience does anyone have dealing with Mi?
By Myron January 3, 2012 - 6:05 pm
Rick,
How is the Georgia market for this business?
By Cindy January 2, 2012 - 8:53 pm
Rick,
I live in Texas with the $1000/10% assignment limitation. Can I use a buyout agreement to purchase the homeowners tax overage interest? If so can you recommend an attorney that could help me with that process?
By Tory December 31, 2011 - 12:00 pm
Thanks. Purchased it yesterday. Looking forward to the new venture. Wish me luck 🙂
By Rick December 30, 2011 - 8:32 pm
Immediate. Digital only though.
By Tory December 30, 2011 - 7:38 pm
Joanne/Rick,
Thanks for the heads up about Texas the $1000 or 10% limit. Rick, when I make the initial payment of $97 for your digital program, will I have instant access to all of the information? Or will I have to wait until the program is paid in full before I can have access to it?
By Rick December 29, 2011 - 1:50 pm
That depends on the area. In many cases, they probably do.
Not something to worry about though. If the lienholder ignored all the previous notices that the tax sale was about to occur (and these were DEFINITELY sent), they will likely not take action with the notice of surplus either.
By Uzo December 29, 2011 - 1:23 pm
If a homeowner applies for the tax overage ..the county says they have to wait 90 days to see if any lien holders will request the excess funds . Does the county notify the lien holders that a claim has been made or do they just wait to see if any body else makes a claim .? Thanks.
By Rick Dawson December 29, 2011 - 11:57 am
Cristen,
If the bank never applies for the overages IN FLORIDA, the funds remain “tied up” and eventually escheat (become permanent property of the state).
An alternative to finding the owner is to find the mortgage holder and purchase the note/mortgage from them at a steep discount (it’s “wiped out” after all). Then collect as the mortgage holder for the full amount of the debt owed, regardless of what you paid.
By Rick Dawson December 29, 2011 - 11:55 am
Danny, those sites are a good start. If you can, get a paid service like MerlinData.com – they have much more extensive information. Also, try the free service Intelius.com. They will give you relative names free and then it often works to search Facebook for the claimant and the relatives and start that way.
Findtheseller.com provides excellent information, but is very expensive and probably not practical for doing volume. However, I’ve often recommended them when there is a high profit to be made upon finding an individual.
By Rick Dawson December 29, 2011 - 11:53 am
Tory, we don’t recommend Texas because you’re limited to $1000 or 10% of the claim, whichever is less. Don’t let this stop you though – there is absolutely no reason to work locally to where you live. You will not be visiting courthouses, claimants, etc in person. You’ll get everything by email and mail.
By Cristen December 27, 2011 - 10:18 pm
Rick or Joanne,
What if the bank never applies for the overage?
By Danny December 27, 2011 - 9:37 pm
To Rick & Joanne,
Is there a specific program or website you recommend using when tracking down former property owners? I’ve been using the Whitepages and Zabasearch with some success but only go so far. Thanks in advance.
By Joanne December 28, 2011 - 5:18 pm
Hi Danny,
I know that I’ve used a service called http://www.findtheseller.com when I couldn’t find the owner of tax lien property. I don’t what services Rick has used.
By Tory December 27, 2011 - 3:34 pm
To Joanne/Rick,
Wow!!! Rick, just saw your 60 minute long training video, and it’s absolutely amazing. I’m ready to get started and attempt your method. Out of curiosity. Have you had any luck with Texas counties? And Joanne, is the program still on sale forr $597 I believe?
By Joanne December 28, 2011 - 5:17 pm
Hi Tory,
You can get Rick’s program at $597 from http://www.TaxLienLady.com/taxsaleoverages. I’ll let Rick answer the question about Texas.
By Joanne December 26, 2011 - 2:24 pm
Maureen Farrell, tax collector in New London Connecticut asked me to make this information available to my subscribers. Please read this if you are planning to use use this strategy in Connecticut:
“I get a number of requests each month for lists of excess funds from Tax Sales. It would be very helpful for those individuals requesting that information to know that the towns in Connecticut holding Tax Sales do not hold the excess funds once the redemption period ends. By State Statute the excess funds must be turned over to the Superior Court of the district and parties with ownership or a lien interest in the property can petition the court for funds they are due.(Connecticut General Statutes 12-157(i)(1), (2) and (3).”
By Rick Dawson December 20, 2011 - 5:46 pm
Remy – Absolutely, that’s a cornerstone of the whole strategy. We do everything by email, phone, and snail mail. Therefore you can work any other state as easily as your own. The only state-specific document is the power of attorney and you can download state-specific POAs from many online legal sites for under $10.
By Remy December 20, 2011 - 12:58 am
Hi,
Can you use the Tax sale program anywhere or do you have to do it in the state that you are from? is there any special paper work or contract/power of attorney needed to claim these funds?
By Rick Dawson December 10, 2011 - 5:45 pm
Cristen – In Florida, all liens have to be satisfied from the property before they will pay the owner (even if you’ve done a bk). It’s a shame because in nearly any other state you likely would have been able to collect if you applied before the bank.
By Cristen December 8, 2011 - 11:44 pm
This question is a little different. Im the homeowner…i filed bk, surrendering the house…lien holder (mort. Co) wouldnt foreclose. House sold for taxes…who is owed the overage? Thanks from Polk County Florida.
By Rick Dawson November 20, 2011 - 5:44 pm
Rissa – Not sure about that, just call the county, explain the situation, and ask.
By Rissa November 1, 2011 - 11:19 pm
Hi, glad to find this site! Just yesterday I purchased a property for a very smal amount that was on the tax deed sale in TX today, and recorded the deed this morning early, well before the tax deed sale started. It sold for more than the minimum bid. How do I claim my overage, & how long do I need to wait? I think the overage goes to the county clerk’s office here, but not sure of what the procedure is & they can’t(or won’t) tell me. Thanks!
By Rick Dawson October 24, 2011 - 5:32 pm
In most states you cannot claim any overage until after the property is lost permanently, either through tax deed sale or final expiration of redemption period.
You could also see about buying the property now. Only a couple states (IN, SC, and AL I think) have liens, which is what you’re describing, along with competitive bidding.
By Bobby October 24, 2011 - 5:00 pm
I live in a state where the original owner has 3 years redemption where they can get the property back within three years if they choose to. Does this change anything ? does that mean I have to only seak out owners that are past the three period to claim their funds or can I call them now and ask if they planed to redeem the property and if not get a deal signed to get the money
By Erich Rempert October 19, 2011 - 5:53 pm
Rick I have seen the course advertized for $597 for the on line version, is this still available, and where can I get it today?
By Joanne October 23, 2011 - 7:45 pm
Hi Erich,
Rick gave me the link for the program at $597 just for my subscribers so now when you go to http://www.TaxLienLady.com/taxsaleoverages, you’ll get that price.
By Chris Hutchinson October 14, 2011 - 1:25 pm
Thanks for the fast response, and info.
Will post results of my findings.
By Rick Dawson October 14, 2011 - 9:39 am
Get a copy of the foreclosure file at the courthouse. It should show the amount paid at auction for the property.
Do you have reason to believe it might have sold for more than you owe? You should get the overage if that’s the case in PA.
If you’re talking about a tax sale, they certainly keep records of the sale prices, don’t take “no” for an answer. Try further up the chain.
By Chris Hutchinson October 14, 2011 - 7:31 am
What are the overage laws in Pennsylvania?, I recently lost a property at a Sheriffs sale in Carbon County, and they won’t give me any results from the auction, they claim they don’t keep such records.
Thanks,
Chris
By Joe Piccirilli October 7, 2011 - 8:15 am
Thank you for the clarification.
By Rick Dawson October 6, 2011 - 12:00 pm
There are no states we know of where the government keeps mortgage foreclosure overages (at least for the first few years).
In most states, you just need to trace the path of the money received at the sale:
1. Agency conducting the sale – do they retain it?
2. If not, where did they send it?
3. Repeat until you end up at the money.
The only problem arises when foreclosures are by trustee’s sale. In some states the trustee immediately remits the overage to a governmental agency like the treasurer. You’re OK there. Follow the process above.
But if the state law says the trustee is to hold the funds for a certain time, then send them straight to the state unclaimed funds department, that can be a problem. The trustee might not be subject to public records requests.
There are probably workarounds to this but we haven’t gotten into them. One possibility is see if there are any real estate foreclosure data services operating, and get historical foreclosure listings. Compare minimum sale price to price paid, and if price paid is bigger there is an overage.
By Joe Piccirilli October 6, 2011 - 11:46 am
I am still confused about foreclosure overages and whether all states can be worked for them. I am specifically interested in the Massachusetts and the other New England states. Any suggestions?
By Rick Dawson October 5, 2011 - 8:06 pm
I recommend Jonathan Petersen in Hammond, IN statewide.
http://attorneypetersen.com
For most things he wouldn’t have to travel so it doesn’t matter where he is.
If you have to have someone in Indianapolis, I know this guy is familiar with the area but I’ve never used him:
Jeffrey M. Bellamy
By Daniel Sanchez October 5, 2011 - 7:58 pm
Could you recommend any attorneys in Indianapolis to work with?
By Rick Dawson September 29, 2011 - 8:14 am
Colorado only has mortgage foreclosure overages. More than half the states don’t have overages, but it’s easy to work a remote state.
As for Indiana, the law change has forced us to change our strategy. Now, we buy the claim from the seller for less than the amount we hope to receive, then claim it ourselves.
We usually make most of the payment to the seller contingent upon a successful collection, therefore we don’t risk money (or need to tie it up).
By Daniel Sanchez September 28, 2011 - 7:54 pm
There is a new Indiana law, IC 6-1.1-24-7 and IC 6-1.1-24-7.5, that limits the fee to 10% and requires a court order to issue the surplus to the agent representing the client. How would you go about getting the court order?
By Primusraina August 17, 2011 - 7:04 pm
Hi Joanne,
I live in Colorado and read somewhere that Colorado doesn’t have tax sale overages. Do you have any information regarding this?
By Craig August 11, 2011 - 5:20 am
Hi, I’m really glad I found this site. Extremely informative. I’ve just recently been studying tax sale overages and I had two questions related to Florida counties (which I would be targeting)that I was hoping you could help me with:
One, I was told you should start with the county treasurer when inquiring about the overages list, but after searching for contact info all I find is info for the Tax Collector of each county – is this who I need to contact? I apologize if this is a stupid question.
Two, once I have received the list do I need to check if there are any liens on the property before I begin to contact the ex-owners? And if so where would I find that info? I would of course like to stay out of any legal or financial hot water 🙂
Also, is Florida one of those states, like CA, with a long waiting period to process checks? Would rather look into counties in other states if that’s case.
Thanks so much for your help! I really am glad I found this site!
By Joanne August 12, 2011 - 4:16 pm
Hi Craig,
Sometimes it’s the county treasurer and sometimes it’s the county tax collector, it just depends on what they call the person that is responsible for collecting property taxes in that state. In Florida it’s the county tax collector.
It really doesn’t matter if there are any liens on the property or not. You don’t have to do any due diligence on the property at all, since non of that matters. The property has already been sold to another party, the overage is sitting at the county and waiting for someone to claim it. What you have to do is find out who is owed this money, contact them and negotiate a commission for getting them their money, then apply for the tax sale overage on their behalf, with the money coming to you as their agent. Then you cut them a check after you receive the money from the county.
I don’t think that Florida has as long a waiting period as California does.
By Rick Dawson June 30, 2011 - 3:52 pm
Is this the only county you tried? I’ve never heard of this problem in Alabama.
Go ahead and post on the forum in the training site!
Rick
By Mark June 30, 2011 - 3:28 pm
I was working in a large county in alabama?
they said that the owner has to get an agreement from the mortgage company to collect the overage, they said the lien holder is entitled to the funds, not the owner?
I’m just really confused as this state does not require an interpleader, which I thought was the reason interpleaders exist, to make sure the person entitled to the funds gets them.
By Mark June 30, 2011 - 1:34 pm
When I ordered the course the webinar said to just contact the person who was the owner at the time of tax sale, it does not however clarify who the owner is, the counties seem to think it is the banks that are entitled to the funds and not the homeowner.
None of these particulars were mentioned in the course…or the fact that we would need to do title searches to locate all lien holders to verify ownership, the course just said contact the people who owned the property at the time of sale and sign em up…easy as can be!
My question initially was who is entitled to the money exactly?
is it the homeowner?
is it the mortgage holder?
and what happens if a foreclosure takes place after the tax sale?
By Rick Dawson June 28, 2011 - 10:11 am
Mark, I’m confused by your statement that the HOO course doesn’t mention anything about owners not being entitled to surplus, and that you wasted your time. We have a 50 state guide to both overages and public records access. And while I can’t guarantee 100% accuracy due to changing laws and the author not being an attorney (me), I think it accomplishes the objective of quickly getting you working in a viable area. If you didn’t get access to that, go to http://deedgrabber.com/support and we’ll set you up.
Stephon, why don’t you attend the next redeemable tax deed sale if you can, and see who collects the money? Then trace it from there. This is the first time I’ve heard of your problem. Georgia is one of our more popular states for overages.
Try other counties by phone.
Rick
By Rick Dawson June 28, 2011 - 10:07 am
Back to CA for a second – yes they are dipping into the funds to cover their budget shortfalls from what I’ve heard and taking years sometimes to catch up. So don’t count on CA claims for short term cash flow.
Aaron, I’m not going to sit here and tell you how easy Hooked on Overages is to make money with. But the alternative in real estate, especially if you need to EARN not just INVEST existing money, are not going to be easier for you generally.
By Rick Dawson June 28, 2011 - 10:03 am
Gene, yes that is an extremely viable strategy where there are overbids and you are the tax buyer. You can sometimes get the majority of your bid back immediately by helping the owner get the overage (not even for a fee necessarily) and agreeing to sell them back the property with most or all of that overage being used as a down payment. Of course, they’d probably owe a bunch more, your profit, and you’d have to take payments.
I’m not sure you can ever engineer a deal like this to happen because you can’t count on what the former owner will do when they get more money that they’ve ever seen before in their hands. But don’t let the opportunity slip by if it presents itself!
By Stephon June 24, 2011 - 2:29 pm
I just recently gone to the county court house here in Conyers, Ga. The clerk of court gave me a hard time. She basically told me that they don’t have any records on Foreclose tax sale, Excess Funds, or Overages. She said that I would have t check with the Attorney that did the Sale of the Foreclosed Property. Did she give me the correct info of do I have to go over her head. Also if this is the case where can I turn to to get a hold of the list.Thanks
By Mark June 24, 2011 - 1:38 pm
I was just wondering when the owners are “not” entitled to the excess funds? I took the HOO course and it doesn’t mention anything regarding this and it is very frustrating to have deals kicked out of the county, the course just says consult a lawyer or read the laws, unfortunately the laws don’t mention anything and lawyers are not willing to give up this information. I would really like to promote the HOO course but at this point I am really figuring out how to ruin them as they are into selling education and not providing it!
By Robert June 13, 2011 - 8:39 pm
Where can I purchase your “Hooked on Overage Course”? How much does it cost?
Thank you,
Robert
By Joanne June 20, 2011 - 8:11 am
Hi Robert,
You can get Rick Dawson’s Hooked on Overages course at http://www.taxlienlady.com/taxsaleoverages. The original price of the course was over $1600, but it’s been discounted to only $597.
By Aaron May 27, 2011 - 10:55 pm
Hello Joanne. This is a great comment section about “Hooked On Overages” and how useful it is. I have a business in Real Estate and it’s not really going well. It seem like it’s too much researching and a HUGE hassle. I’ve been trying to find a VERY GOOD program and very easy to use with great understanding. Hooked On Overages looks very tempting and promising but I just want you or someone to tell me:
How efficient is Hooked On Overages (HOO)?
Is the research hard to do when it comes to looking for clients and getting a decent amount of a check?
I would like a insight before I decide to do this business expenditure. Ohh by the way, I live in NY. It seem like we’re practically neighbors lol.
By Joanne June 1, 2011 - 9:35 am
Hi Aaron,
This isn’t a strategy that I actively persue. I prefer tax lien investing, even though it may take longer to get paid. I invest for the future. Tax lien investing is a way that I can invest money at a high rate of return for the near future (with after tax money) and for my retirement (with money from my SEP IRA). I prefer this because I do not like negotiating with people. However this is a very good strategy for people who want to get paid faster and want to make money without having to invest. I’m at the point where I would rather invest my money than my time. And I think that this strategy is more of an investment in your time than in your money. You do have to either send out a lot of letters or make phone calls. I don’t like to do either, which is why I stick to tax lien investing. However if you are already a real estate investor than you are used to doing this and I think that you’ll find the Hooked On Overages strategy more efficient in today’s market, plus there’s no due diligence, so less work on your part.
If you would like more help I suggest that you leave a comment for Rick on the sales page where you’ll find a lot of questions and answers already. It’s at http://www.taxlienlady.com/taxsaleoverages. Just scroll down to the bottom of the page to see the comments.
By Lance Marlman April 28, 2011 - 12:09 pm
Hi Joanne
my Question is: Do you have to get release from sen.lien holder all the time.And if thats the case then do you cherry pick.
By Joanne April 28, 2011 - 7:35 pm
Hi Lance,
With the Hooked on Overages program you are finding people that are already owed the overages and then applying for the money for them, as their agent. So the money is already owed to them. In some cases it could be that lien holders may also have a claim to the money, but they would have to actually claim it. I don’t think that you would need their release, however laws are different in each state, and this would be a great question for Rick at our upcoming webinar.
By Cila April 26, 2011 - 6:53 pm
Greetings Joanne, how are you?
To answer your previous question above, I think TSA stands for
?Tax Sale Arbitrage?
Anyway, I wanted to introduce myself and to let you know that I’m also in ” Hooked On Overages”, I’m very new though and know nothing yet.
I”m in Calif and can’t wait to get started.
Are you in Calif also and are u also involved with Hooked On Overages?
Thanks,
Precila
By Joanne April 27, 2011 - 7:29 pm
Hi Cila,
thanks for clarification about TSA. I’m in PA, so I’m on the east coast not the west coast. One caution about using the Hooked on Overages program in CA. California is having huge financial difficulties right now and is taking very long to cut checks for overages, you may have to wait as long as 2 years. So you might want to look into other states. I’ve been talking to Rick Dawson about setting up a webinar for next week, where he’ll be able to answer questions about Hooked on Overages. It looks like it will be next Thursday, I’m waiting to get confirmation on the time of webinar and then I’ll let everyone know about it.
By MR April 18, 2011 - 4:54 pm
I received an email from TSA. When I asked where they got my information, no response. Has anyone else encountered this?
By Joanne April 20, 2011 - 9:39 am
MR, Who is TSA?
By Shawn April 12, 2011 - 6:32 pm
Gene – you have more time than you think in cali. Its one year from when the tax deed is given to the purchaser. This is often over a year after the sale so 2 years. Shawn
By Gene Schneider March 31, 2011 - 11:05 pm
I just viewed a webinar on ‘Tax Sale Arbitrage’ and, like your correspondent, asked questions that were never answered. (Having been burned by this before, I realized that the webinar was pre-recorded…so the fast-action bonuses were long gone…that’s a different discussion.)
My questions are:
– how long after the sale ends can the money be claimed?
– does it work in California? specifically, Kern County?
Actually, now that I’ve seen the entire thread, I believe you’ve answered both questions.
The claim period is 1 year. Rats. I’m just a year too late!
I purchased two properties in my home town in the County tax sale in February 2009. The bidding was heavy, so I paid 4-5 times the tax bill amount to acquire the properties…which I immediately leased back to the previous owners.
If I had known that the price differential could be claimed, I could have:
– gotten that money back for the owners,
– sold their houses back to them using that as a down payment,
– gotten mortgage payments each month instead of rent payments
and everyone would win big-time.
Well, I know it now. And I’ll use it in the future.
By Joanne April 1, 2011 - 1:05 pm
Gene,
You may not be entirely too late yet. The money stays in the county as “excess proceeds” from the tax sale for a year, but it may go to the state as unclaimed funds after that. I don’t think that the money “escheats” to the state for another 2 or possibly 3 years. You can still get the money back for the owners, but now there is a cap of 10% that you can charge the owner, since now the money is unclaimed property and not excess proceeds. Also for Kearn County there is a list from the last tax sale – which I think is the one that you are referring too (Feb 22, 2010), that does list the results of the sale, including the excess proceeds.
I wouldn’t give up just yet, since the entire state of California is in such a poor financial state, the money may not have gone from the county to the state yet. First check with the county treasurer about the excess funds from last year’s tax sale. Ask if they can still be claimed. If not, ask what happened to money and if there is a way that you can still claim it from the state?
Good Luck and let me know how you make out with this!
By Gurpreet March 28, 2011 - 4:52 pm
Joanne,
What are the laws for California, when it comes to overages? Is there a cap on the amount of percentage we can charge for the overage? I am thinking about getting the course but want to stick with Northern California, wanted to get your opinion if it was worth here?
Thanks
By Joanne March 30, 2011 - 12:23 pm
There is a cap (10%) on the amount that a third party can receive once the funds are classified as “unclaimed property.” But I do not think this effects money in the “delinquent tax sale trust fund,” which is where the overage is deposited for one year. I think that after that it becomes unlaimed funds. This is a questions that I can ask Rick on the upcoming webinar.
Also there are stipulations that in order to claim the money acting on somone else’s behalf you have to submit proof that “submit proof with the claim that the amount of excess proceeds has been disclosed to the party of interest and that the party of interest has been advised of his or her right to file a claim for the excess proceeds on his or her own behalf.”
By jon March 25, 2011 - 1:11 pm
You must be “skeptical” of my ability to spell
By Joanne March 25, 2011 - 8:43 pm
Hi Jon,
Be happy to answer your question, and I’m not so great at spelling myself. I rely heavily on spell check, but still make mistakes. Even if the county is bankrupt or near bankruptcy, there are laws that protect that money for a period of time. They have to make that money available to the owner. I believe that it is possible to get the list from some counties. Some counties even go so far as to put it online. But you have to look into it further because some counties also make it difficult for anyone else besides the owner to collect the overage, and in order to get paid you have to have the check come to you and then pay the original property owner. You are acting as an agent for the owner. Some counties will not allow you to do this, others will but they’ll put a limit as to what you can charge. You just have to know the laws in the state and county that you are dealing with.
By jon March 25, 2011 - 1:08 pm
Hi Joanne,
Yes I have seen the “Tax Sale Arbitrage” pitch and asked a question which was never answered by them so I’ll put the question to you.
The TSA course claims they simply send an email to the county office requesting a list of all property owners who are owed money.
I am very skepticle they ever get such a list from near bankrupt county gov.’s across the US who as we all know do just the minimum to find the owners who lost their homes.
Q: From your experience, is it possible to get such a list from counties?