As some states and local governments become more insolvent, they are finding ways to squeeze more money out of tax payers and property owners, including unsuspecting tax deed buyers. This is something that you need to be aware of if you purchase tax deeds in Indiana from out of state. I want to thank Jim for providing this warning to investors from his own personal experience.
“I buy tax deeds in Indiana because the returns can be very sweet.
In December ’11, I closed on an abandoned house I bought in Hammond, Indiana at the Lake County Tax Deed auction held in September 2010. Paid $3000, sold for $9,000 netted about $1600 after fees/expenses.
However…what Hammond did was hit me with all sorts of high fees for taking care of the house between the time I bought it and got clear title — about 13 months. Those fees include things like boarding up the windows, mowing the grass, etc. None of these fees came up in the title search except for $534, which I thought was semi-fair.
Then the city of Hammond hit me with an additional $1054 in costs on the day of closing that we had to put is escrow so my attorney could fight it. This was a big part of my profits and I was hacked.
Well according to my realtor — whose company is third generation owned — hard hit Indiana cities like Hammond and Gary are hitting tax deed investors hard with these fees.
Many of these investors have attended tax lien seminars and buy five or six houses at a time. However, they don’t spend the money to get good title work via a local attorney (which I did.). So these cities are really hurting the returns of these novice investors. And since many (like myself) are from out of state with out of state attorneys, they are getting royally screwed.
In fact, my realtor says no one in his family will touch liens or deeds anymore due to the chicken-bleep fees these cities are charging. He is also warming out of state investors to be careful what they spend as he has had some VERY unhappy customers in his office on the day of closing.
Fortunately my local Hammond attorney was able to get every penny of the $1054 by the end of January 2012 refunded to me and I am a happy guy. But am not sure about attending the next Lake County tax deed auction.”
By robert February 24, 2012 - 1:09 pm
joanne,
how much is your course? any boot camp in it like a 3-day boot camp included?
robert.
By Joanne February 24, 2012 - 10:29 pm
Hi Robert,
The home study course is $497 and a one day conference – on April 14 is included plus lifetime updates, unlimited e-mail support, an hour of coaching and 2 month membership to Tax Lien Lady’s Members Area. Find out more about the conference at http://www.TaxLienLady.com/conference and more about the home study course at http://www.ProfitableTaxLienPortfolio.com.
By Barry February 23, 2012 - 2:45 pm
I was actually referring to the article (which talks about Indiana), not Robert’s comment
By Joanne February 23, 2012 - 3:01 pm
Yes Barry,
Indiana is a lien state but like some other lien states they do have deed sales as well. Liens that are not sold in the commissioners sale are certified to the county and may be sold in a deed sale.
By Robert February 23, 2012 - 1:35 pm
I’m talking about Colorado where there are time limits once a title search and publication are done, but no requirement of when to start the process. Some counties deliberately stretch out the time before beginning the process (that the lien holder has paid for) to avoid evicting the tax debtor.
I thought it should go with the out-of-state warnings because if you are not aware of the state laws and county procedures, you may not be aware that issuance of a treasurer’s deed in Colorado can take up to a year after paying the fees and maybe another year’s worth of taxes.
By Joanne February 23, 2012 - 2:36 pm
hi Robert,
thanks for the information about the foreclosure process in Colorado. It’s still much better in other states, such as Arizona and New Jersey, where you have to get a lawyer and go through foreclosure procedures in the courts and it could take years because of the all the back log due to the amount of bank foreclosures going through the courts these days.
By Barry February 23, 2012 - 8:09 am
I didn’t think that Indiana had tax deed sales (even a commissioner’s sale is a tax lien sale), so are you referring to a tax lien auction in Indiana or am I missing something?
By Robert February 21, 2012 - 1:10 pm
I found another problem, counties that don’t process treasurer’s deed applications. One was a minor problem in that the property owner paid the past taxes after publication, but I was told by the treasurer’s deed technician that in that county, it takes A YEAR to get the treasurer’s deed because the Treasurer doesn’t like to seize people’s homes. I just got off the phone with another county where I paid for and put in the treasurer’s deed application three months ago and they haven’t even started the process. This is a county that claims to have 4 CTD technicians yet the title search (typically a day process) hasn’t even started yet. Plus, one the title search and publication is given, I have to wait four months on top of that to get the deed.