there is a guy (Beck) always on TV here in Florida selling the same thing. I think they make big money off the kit? Another business scamming on the get rich quick crowd. We have similar rules here in Florida.

Darin...so you're saying that your Tax Deed sales are similar to ours here in Arkansas?  I'm familar with Beck and he's one of the guys I'm referring to.  I don't understand how this doesn't break some law unless there are states where you can do this.

There are always folks looking for the quick buck....In this case it is the TV pitchman!

I talked to some buyer who is a renter now with little money to put down that thinks he is going to be a tax deed property for next to nothing, I was thinking..WHATEVER buddy.

Well, in addition...not all tax deed property exists.  I know of one in my area that a California woman bought sight unseen for $900.  She thinks it's a lakefront lot but as it turns out, the property was actually part of a major purchase track of land about 10 years ago and the tax office never removed that particular lot.  So here she owns a lot that Doesn't Exist!

David ,yes Florida has the same deal, most investors buy the Tax certificate @ 12-18% but only to make the interest off them rarely does the home get forfeited to the buyer of the certificate.

I think those ads do a lot of damage.  Buyers think that the market is much worse than it is, that there are tons of tax lien properties, so why not make a lowball offer on that pristine property priced below market.  I'm with you on this, David.  Sick of those rip off ads.

These no money down, get rich quick con artists make sooooo much money peddling B.S.  I went to one by   a well known author, and people flocked to the back room to spend $ 1,000.00  on books and tapes.. I could not beleive it.   I later went to one endorsed by a couple of Midgets,  when the presentation started, their presenter was using the same pictures of the run down properties that was used in the previous persons Presentation.  Stating they were properties they bought, fixed up and sold..  The presenter in the previous presentation was stating the same thing..   I wish they would monitor these sleezy sales seminars..  Yes you can get rich in real estate, and yes you can invest with no money down, but it is not as easy as these CON ARTISTS make it sound.   Thanks for pointing this stuff out David.

I agree with David and others that the infomercials don't help the image of this type of investing.  However, I wouldn't say that you can't make any money.  Kansas is a tax deed state but there is no redemption period.  Other states have shorter or no redemption as well.  I work with investors in Kansas and I have personally purchased property at a tax deed sale - usually undeveloped lots and flipped them to builders for a profit.  Not the huge claims that are at the top of this blog, but myself and the investors I work with double our money or we don't buy it.  Also, I believe that you must always focus and target your investing to one specific county, know everything about it (zoning, new development, etc.) and then this type of investing will work. 

Buying a property sight unseen that doesn't exist is probably because of the lack of due diligence on the buyer's part.  A quick call to the county courthouse would have prevented that issue.  In my experience the country treasurer, appraiser and deed recorder have been very helpful when researching properties on tax sales.  There is a list at I think www.taxsalelists.com which tells what states are deed and what their redemption times are - there are very few with little or no redemption times.  I think you pretty much have to live in the area that you want to invest in or you won't be profitable and successful and you won't be tempted to buy sight unseen if you live there.

I worked with an investor here in Kansas that bought a condemended house at a tax sale for $2,000 and then did a total rehab and then rented it out for a great positive cash flow.  The house was valued at about $95,000 after rehab costs of approx $22,000.   BUT - this investor spent 3 weeks talking with the county and city inspector and notified them of his plans and submitted all his plans so that he had permits in hand within a week after buying at the auction. He went so far as to go mow down the weeds and trim the trees prior to the tax auction to show good faith to the city engineer.  I was the selling agent on this house about 3 years later when the property sold for $161,000.  This investor buys and rehabs property only in this one area and one specific county.  This goes back to focusing on one area only so that you know what's happening in the area.  I believe that you have to invest in communities not properties to succeed in this type of investing.   

Marisa...thanks for the information and website link.  That is very helpful. 

Then, there are the title issues. Most title insurance undewrwriters won't insure Tax Deeds for some of the reasons mentioned above.

That reminds me of 4 properties for sale I saw on a foreclosure website that had a contact person.  I read the ad and the person selling has only a first name and telephone number.  I looked in the tax records and they DON'T own the house and I looked in the Real Estate Commission and they are NOT licensed.....so I wrote them and 2 responded by saying they "have it under contact and assigning it".  CRAP!  That's just a bunch of crap!  Either buy it and sell it or the owner just just list it.  What's which these "go betweeners"?

David -- yeah, a lot of people try to stay clear of that don't they.?..A stand alone transaction is usually much cleaner.

David,  Texas is not a tax deed state like in your state and I have bought a number of properties as an investment here.  We do have a time frame where the owners can recover the property but they have to pay a percentage for any improvements made to the property.  In Texas we have auctions on the courthouse steps with the buyers receiving a Sheriff's Deed to the property subject to recovery by owner.  Any property not sold at the auctions can be purchased at the tax office on a first come basis. 

Don...sounds simplier than here for sure.  I have a potential deal now that could be bought for about $14K with no other bidders in a remote place that could sell for around $150K but I don't have the money to sit on it for a year, plus if anyone else bids it could go to maybe $50K.

David, Great post.  These infomercial snake-oil salesman are a hoot though. I love it when they run the disclaimer "individual results may vary"...gee ya think?  If churning 50 grand on a deal was so easy...why on earth do they need to sell you a box of dvd's for $199.  I still watch them though..scary huh..

LOL, that's funny Tim.  Yeah...some of them irritate the crap out of me.  You'd think there would be some law against blatant lying.