What happens in the event there is still an outstanding loan on the property? In the event of foreclosure who is responsible for the remaining balance/pay off of the note(s) on the property are you able to still foreclose (after said time period) on the property regardless of the status of notes/monies owed on the property?
There are two ways to answer that question:
1. If the homeowner doesn’t pay his mortgage and the bank forecloses on him, then the bank will pay off his other liens when they take it back and put it up for sale with a Realtor. This includes the property tax lien certificate you own. You’ll get your initial investment and the 16% (pro-rated monthly) in interest owed.
2. If you foreclose on the tax lien, then all other liens are typically wiped out as property taxes take precedent to almost all other liens.
They work this way because the government ALWAYS wants to make sure it gets paid. Any mortgages that existed on the property are typically wiped clean when the property is transferred into your name. Those mortgages will still be owed by the homeowner, it’s just that the property they were tied to, is no longer his to use as collateral.
But don’t just take our word for it, be sure to do your due diligence first as detailed in the Intermediate and Advanced Education sections of our website.
How else can I get Arizona Tax Lien Lists?
You can also get the Arizona Tax Lien List for the County you want to invest in, by contacting the County’s Tax Assessor’s office.
They will ask you to mail in a check (typically for $39.99 to $99.99 depending on the county). Once they have received your check and it has cleared (2-3 weeks), they will mail you your list. Total time required to receive the tax lien list is typically 6-8 weeks.
Or you can order them online from us. We typically charge less than the county tax assessor’s office does and you can download them immediately, online. We update our lists on a quarterly basis to make sure you always get the freshest list.
What is the most important thing to look for to make sure you buy the best tax lien certificate?
That’s a tough question to answer as it depends on where your interest and experience lie.
Some people prefer purchasing tax lien certificates on raw land as they’re easy to acquire. Some prefer single family homes as they’re the easiest to flip. Some prefer commercial property as they know how to rent them out for a great cash flow.
Which ever type of property you choose to focus on, the most important thing to remember is to do your due diligence on the property you want to buy the tax lien certificate on.
The due diligence on each type of property is different so your best bet is to get the education you need to make sure you’re buying a great tax lien certificate that you’ll be sure to make a great profit off of.
To that end, I highly recommend you get the due diligence education that will ensure your safe investments and maximum ROI. Please see the Intermediate and Advanced Education sections of our website for more details.
Where can I find the laws that govern Arizona Tax Liens?
The Arizona Revised Statutes that pertain to the tax liens are available online at Title 42, Chapter 18, beginning with Article 3.
You can also find them at the Maricopa County Law Library, 101 W Jefferson Street, Phoenix AZ 85003, Phone 1-602-506-3461.
Are Arizona Tax Lien Certificates transferable?
Arizona Tax Lien Certificates may be transferred by completing an endorsement form and paying the applicable fees. Learn more in the Intermediate and Advanced Education sections of our website.
What is the “life” of a tax certificate?
Arizona Tax Lien Certificates are dated as of the date the purchase was made.
Ten years later, if the purchaser has taken no additional action to foreclose the tax lien, the lien expires and is voided. No payments will be made to the purchaser. A purchaser may initiate a Judicial Foreclosure action after three years from the initial purchase date.
What happens if the property owner declares Bankruptcy?
Bankruptcy rulings may also affect the interest rate on your tax lien certificate. Learn more in the Intermediate and Advanced Education sections of our website.
Once I buy a Tax Lien Certificate, do I have to buy the tax lien certificate on that property every year after that until I can foreclose on the property or is it a one time purchase?
You only need to purchase the tax lien certificate for one year. After 3 years, you can then foreclose on the tax lien. When you foreclose on the tax lien, you will need to pay any additional back taxes that are due.
As an example, if you buy the tax lien for 2003 in 2005 and by 2008 the owner does not pay his back property taxes, you can foreclose on the tax lien and pay any additional back taxes that may be due.
If the owner did not pay his property taxes in 2005, then it’s likely that he did not pay them in 2004, 2005, 2006, 2007 and 2008, so you may need to pay those too. You can pay for those (plus the additional 16% late payment) at the time of foreclosure.
You can learn how this works in greater deal in the Intermediate and Advanced Education sections of our website.
If the property I acquire the tax lien certificate for has a fire and is completely damaged, do I still get my initial investment plus interest?
If the owner pays his property tax, then yes, you would get your initial investment plus interest.
If the owner does not pay his property taxes, then you could foreclose on the property and then sell it for a far superior ROI (even in its damaged condition).