How to Find Tax Lien Property

Rises in back taxes owed and property foreclosures are common occurrences during tough economic times. Government agencies use auctions to dispose of real estate acquired through seizure and foreclosure actions. The minimum bids for the properties are often the amount of the back taxes owed, which could be a fraction of the assessed values of the properties. Use diligent research and preparedness to successfully find tax lien properties to acquire.

Instructions

1. Determine and list your property ownership goals. Write down the characteristics a property must have in order to fulfill those goals. Consider location, rehabilitation costs, zoning, property taxes, landmark status and other issues that affect the cost, use and value of property. Use that list of goals and characteristics to determine which properties to bid on during property auctions.

2. Drive through desired neighborhoods. Homes that have been seized or foreclosed will sometimes have auction information posted on or outside of the homes. Write down all relevant auction information.

3. Attend local government auctions of properties that have been seized or foreclosed. Some properties are there because of back taxes owed and others because of criminal seizures. Before attending the auction, contact the hosting municipal agency to learn the requirements of the auction such as identification and accepted payment methods.

4. Attend Internal Revenue Service (IRS) property auctions. The IRS uses its website (http://www.ustreas.gov/auctions/irs) to inform the public about current and upcoming auctions. IRS auctions accept only cash or certified funds as payment.

5. Seek professional advice. Hire a real estate professional to help you make decisions. Use her experience and knowledge to determine which properties to bid on and which properties are worth the minimum bids. Ask the real estate professional about the type of title you will have if you place a winning bid.

Tips & Warnings

• -- If it is possible to acquire a list of properties in an auction beforehand, visit the properties before the auction starts.

• -- For 180 days after a property is acquired at an IRS auction, certain parties, such as people with liens and actions against the property, may lay claim to the property.

• -- Hire a professional to inspect properties acquired through auctions.

References

• Internal Revenue Service
• The Department of the Treasury

Resources

• National Association of Realtors
• USA.gov