Ron Starr...Question on your buying strategy - Posted by Mike

Posted by Ronald * Starr(in No CA) on June 16, 2003 at 21:27:21:


The laws on collection of delinquent property taxs are different for every state.

I do not buy at the OK tax sales. Those are auctions of liens or certificates against the property. I bid at the “tax resales.” I think all lien/certificate states have a similar sale, but with a different name. It is the auctioning of a deed interest in properties that have tax liens which were struck off to the county and nobody bought them–took assignments on them–in the intervening three years since the tax sales. In “deed” states there are no liens, there are only the auctions of the property deeds, so the way I buy would work in deed states. Michigan is now a deed state, I think; the law having changed about three or four years ago.

Yes, I drive around and look at the buildings that are scheduled for the auctions. Then I bid at the sales. I OK I have agents bid for me, as all of the tax resales are conducted simultaneously. It is a lot of hard work. I drove around 3400 miles in two weeks time. Looked at something like 40 or 50 houses–or vacant lots that the assessment roll showed as having a structure on it. Most of them never made it to the sale. I got four this year. Typically I get one or two. I had more money this year, since I let a county tax collector sell my lot at tax sale last year and I got the excess proceeds over the taxes owed. There is also some luck involved, as you don’t know which will actually go to sale. I had people prepared to bid on houses in something like four counties and I got houses in two.

OK has just 8% for the lien holders when the taxes are paid, so there is less enthusiasm than in states with high return, such as IL, IO, and TX. Thus more liens are not bought, thus more properties go to tax resale. There are not very many nice houses in nice areas that get to sale. Over 90% are vacant lots and land.

This year I went out to buy vacant lots which I have not done before. I plan to resell them on internet sales sites. It is an experiment. For the first three years of tax resale buying in OK, I called my actions an “experiment.” Last year and this year I called it “an investment program.”

Good InvestingRon Starr

Ron Starr…Question on your buying strategy - Posted by Mike

Posted by Mike on June 16, 2003 at 12:19:07:


Ron, I see that you appear invest solely in OK tax sale properties. Your style intrigues me. I was under the impression that it’s extremely difficult and competive in the field of tax liens and tax deeds these days (in all states). You, however, seem to be having good success in OK. I live in Illinois and I know the tax lien process is very different from OK. Apparently, you have the ability to get the deed almost immediately after buying at the sale. Most tax investors here buy solely for the interest rate and not the property. Here is takes 2-3 years minimum to get the deed if the owner doesn’t redeem in that time.

Can you share a little more about the strategy you implement? I’m curious as to how many properties you actually bid on to get title. Also, I understand that you physically investigate the subject properties that your interested in bidding on. This isn’t something that I can do, or really want to do, as I live so far from the state of OK. However, I believe MI has similar tax sale laws. Perhaps your strategy could be applied in MI??

Anyhow, your wonderful insight would be greatly appreciated. I’m trying to educate myself on the field of tax deeds and how best to approach it.

Thanks much.