Did you know that you might be missing out on little known tax sales close to where you live? I always get questions about how to avoid the intense competition at the tax sales and if tax lien and tax deed investing is still profitable with all the competition these days from big fund companies and banks. The truth is that it is still very profitable, just not as easy as it used to be 20 years ago. The trick is finding little known tax sales that aren’t readily known about and they could be in your own back yard!
Acres of Diamonds
Have you heard the well known inspirational story called “Acres of Diamonds.” It’s a supposedly true story told thousand of times by the early 20th century Baptist preacher Russell Conwell. The story is about a wealthy farmer in India, who lived a very content life until he learned of the exitance of diamonds – the most precious gemstones. He became obsessed with the thought of finding diamonds and becoming one of the wealthiest men in the world. He sold his farm and spent everything he had traveling the world looking for diamonds until all his money ran out. He never found any diamonds. Despondent, penniless and without hope, he drowned himself.
Meanwhile the farmer that bought his farm had discovered a shinny rock in a garden brook that his camel was drinking at. He took it home and placed it on the mantel of his fireplace. When an old Buddhist priest came by (the same priest who had told the previous owner about the existence of diamonds) he saw the rock and recognized it as a diamond in the rough. This was the discovery of the Golconda diamond mine, one of the most important diamond mines in all of Asia.
Little Known Tax Sales in Your Own Back Yard
How does the Acres of Diamonds story relate to tax sales and tax lien investing? I often get questions from investors who want to know where are the best states to invest in. They want to know which states pay the most interest. But what they don’t realize is that most tax lien states with very high interest rates have auctions where the interest rates are bid down. And these auctions are very competitive. Redeemable deed states that have very high penalty rates are also very competitive.
Just like the wealthy land owner who left his farm to look for diamonds. They are spending time and money looking for that most profitable place to invest. Meanwhile they may not have investigated what goes on with delinquent tax properties in the town or county they live in. Or other areas that are close by. Sometimes you find the best tax sales and the best deals in out of the way places where no one else is looking.
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