Posted by Kristine-CA on February 08, 2008 at 20:17:19:
Bill: thanks for your reply. I think maybe I’m not explaining myself
very well. You say you get back $$$ and interest just like any other
note. In my experience, notes pay you back interest and principal
monthly. So is investing in tax liens more like balloon notes with no
payments? In that you get your capital and interest back at the time of
redemption?
What is the range of the mandataed redemption period lengths in the
states you are working in? Kristine
Posted by Bill H on February 10, 2008 at 16:02:18:
THE WRIT
A writ of fieri facias (Fi-Fa) is an order which is issued by a judge and directs the levy officer to seize the property of the named defendant. The elements of form for a writ of fieri facias are decided and set out by the Georgia Supreme Court (form SC-5 revised 1985).
Posted by Kristine-CA on February 08, 2008 at 20:22:01:
Michaela: thanks for the info about GA. I undersand the 12 month
redemption period and the 20% that is due the tax lien investor. But
I’m confused about “you have either wait until someone buys the
property somehow or you can push for a tax sale.”
I thought the whole point of tax lien investing is that you either get the
interest or get the property. Why would the tax lien investor have to
push for a tax sale? Isn’t there some process by which the investor
becomes the owner when the defaulting owner fails to redeem?
Kristine
Posted by michaela-CA on February 09, 2008 at 10:06:30:
Kristine,
it’s correct, that you don’t see any income until the property is redeemed in some way.
In Atlanta (Fulton County) they are very, very slow at foreclosing on vacant lots. Some of them sit there for 20 years, before they come up for tax auction. And that only happens because a builder pushed for it, because they want to do something in that area and want to see it improved. There are so many foreclosures, that they pick and chose the ones that bring int he most money for them (at least that’s how I think they pick and chose). Also the title searches are so much more daunting on those old lots than they are on properties with houses, as those are more recent delinquencies usually.
In Atlanta also, if you’re trying to buy a property that’s been delinquent for a long time, the old taxes and utility liens are not collectable after 7 years.
So, the closer you are to the 7 year mark, the more you can actually negotiate with the water dept etc. Old fifas are payable in full, but the tax liens that are still held by the county are only collectabel for the past 7 years.
I know that’s just one state (I don’t know if this goes for the whole state), but I’m sure every state may have their own idiosyncracies, whether mandated by law or not.
Re: Fi-Fa is the Writ of execution - Posted by michaela-CA
Posted by michaela-CA on February 10, 2008 at 17:50:33:
Maybe the wrong word is being used, but all the sold tax liens are called Fifas in Atlanta. It doesn’t seem to initiae any seizuer of the property. I’ve bought lots of property that had fifas that were years old without any action having been taken on the property.
Posted by michaela-CA on February 09, 2008 at 09:57:48:
Most of the tax lien investors in Georgia are companies like ‘vesta holding’ who do this for the eventual interest that they get when the property sells. As far as I know the only way a tax lien investor can get the actual property is that he/she’d have to force a tax sale and bid on it. Or they could try to find the owner and be in a better bargaining position. Owning the tax lien does not actually give them any rights over the property as far as I know.
Posted by IB (NJ) on February 08, 2008 at 20:34:13:
I wondered the same thing as I saw it go down like that in FL. Investors buy the lien and force a sale where the property is sold to the highest bidder. As far as I can see the only thing the investor is getting is the interest. Certainly not the property unless I’m missing something.
Posted by haynesm on February 09, 2008 at 20:54:30:
I’m not sure on this but I have read Bills post before. I think what he was saying is that since he buys LOTS of tax liens in many states then they are redeemd at different times and therefore he has an income thoughout the monts. Also suppose you purchased 50 liens at a sale and the owners came and redeemed them at their leisure then you would be getting your money back plus interest as they were redeemed. Sorry for stepping in Bill and making an assumption that may be wrong.
Re: Fi-Fa is the Writ of execution - Posted by Bill H
Posted by Bill H on February 10, 2008 at 18:10:08:
Here is a good explanation of the Fi-FaProcess. I just excerpted the first para in the previous post. Hope this helps to straighten things out.
WRIT OF FIERI FACIAS
THE WRIT
A writ of fieri facias (Fi-Fa) is an order which is issued by a judge and directs the levy officer to seize the property of the named defendant. The elements of form for a writ of fieri facias are decided and set out by the Georgia Supreme Court (form SC-5 revised 1985).
All elements have to be present in the form of the writ for it to be valid and legal. Any deficiency in the form of the writ, not conforming to the dictates of the Georgia Supreme Court, will then result in the Fi-Fa not being valid, hence, the writ not being enforceable. In other words, it would not be executable.
For a writ of fieri facias to issue, a monetary judgment or judicial award is required. In the case of where judgment is rendered on behalf of the defendant, the writ may properly indicate to collect against the plaintiff. This can be due to the result of a successful defense, a counterclaim or due to other actions of the court.
These issues may be many and widely varied. Judgments may arise from criminal bond forfeiture, lawsuits of various natures, foreclosure, a default in the answering of a garnishment, an award of alimony/child support, etc. A writ of fieri facias may be issued from any of the following: judgments, awards, sales taxes, ad valorem taxes, property taxes, income taxes, etc., the foregoing recitation being a very non-inclusive list.
If the â??styleâ?? of the Fi-Fa, does not mirror the â??styleâ?? of the judgment, the writ is illegal and is not executable. If the â??styleâ?? of the case on the writ does not reflect the actual name of the corporate entity as it exists with the Secretary of State, the writ is illegal and is not executable. So it is paramount that the styling of the case be correct from the outset and throughout the pursuit of the case.
A model for a Fi-Fa collection procedures flyer for public distribution
FI-FA COLLECTION PROCEDURES
19-13-10 O.C.G.A. (Official Code of Georgia Annotated) requires the Sheriff (or his lawful deputy) to make levies pursuant to a writ of fieri facias (Fi-Fa) or other writ of attachment on the property, either real or personal or both, of the defendant in Fi-Fa. Plaintiff must first have received a monetary judgment from the court before a writ of Fi-Fa may be issued. When the Fi-Fa has been recorded on the General Execution Docket (G.E.D.), it should be taken to the sheriffâ??s office civil section for action by the levy officer. If the defendant has property in another county, the Fi-Fa should be entered on the G.E.D. of that county and then taken to the sheriff of the respective county for action.
Plaintiff may pursue a garnishment of the defendantâ??s employer and/or bank account (O.C.G.A. 18-4-64) while simultaneously attempting a levy under Fi-Fa. If the plaintiff is not familiar with the defendantâ??s place of employment, bank accounts, or property owned, defendant may be served with post-judgment interrogatories in an attempt to obtain this information. Interrogatories are a set of questions whereby the defendant must list any assets, both real and personal, and file back with the court under penalty of contempt.
Upon receiving a Fi-Fa, it has been our established policy to mail the defendant a â??Fi-Fa collection letterâ?? in hopes that the defendant will voluntarily respond to resolve the judgment. This step is not required by law, but does produce some noticeable results.
It is the responsibility of the plaintiff to locate any property of the defendant that is not subject to any prior outstanding lien. In the case of motor vehicles, O.C.G.A. 40-2-130(c) requires and authorizes any officer to ascertain any outstanding liens for the judgment creditor. Plaintiff must be careful not to over-levy and run the risk of being subject to possible litigation by the defendant. Plaintiff should also note that if the levied property does not produce sufficient proceeds at Sheriffâ??s Sale to offset the costs incurred, plaintiff is responsible for the difference.
When approaching defendant for collection, the levy officer first makes oral demand for payment. If payment is not made, defendant is permitted by law (9-13-50(a) O.C.G.A.) to designate the property upon which to levy that would be sufficient to satisfy the judgment Fi-Fa. Failing this response, it is the responsibility of the plaintiff to designate the property upon which to levy. Title 44 chapter 13 O.C.G.A. provides for constitutional and statutory exemptions from levy.
The property must be published in a Notice of Sheriffâ??s Sale in the legal organ of the county for the four weeks immediately prior to sale and sold at public auction the first Tuesday in the month following publication. 15-16-10(a)(4) O.C.G.A. requires the Sheriff to maintain bound copies of the newspaper selected as legal organ in the same manner as required by law for the Clerk of Superior Court. The time of the sale is set pursuant to 9-13-160 O.C.G.A. The costs of legal advertisement are due and payable in advance by the plaintiff.
Arrangement for and payment of any towing, transport, storage, etc., are the responsibility of the plaintiff. Storage must be safe, secure and inside the county where seized (preferably in a bonded and insured warehouse). Plaintiff is entitled to recover any reasonable costs incurred in the collection of the payment from the proceeds of the sale. These costs should be documented. The Fi-Fa is in force for seven years and is renewable every seven years thereafter. If the full amount of the judgment is not realized from the initial levy, additional levies can be made until the judgment is satisfied.
Posted by Kristine-CA on February 09, 2008 at 17:29:59:
MIchaela: in other states the property does go to the tax lien investor.
All different kinds of procedures and different redemption times, of
course. And the bulk of the properties are redeemd.
It is my understanding from at least one tax lien investor that GA is one
difficult state in which to use this strategy.
Posted by Bob Smith on February 10, 2008 at 19:37:10:
In Florida, the tax lien holder is the initial bidder for the property at a tax
lien sale (in the amount of their lien). If that’s the high bid, they get the
property. Obviously that’s rarely the high bid.
I am in michigan, how can I find law about this, we have private individual doing writ of execution, he’s even doing it on sunday, as law says is forbidden, he is stealing people’s things and selling them, he sets up a “yard sale” out in yard and has people come and buy household items such as appliances and big furniture, what can we do to stop this illegal behavior?
Sheriff and I went to the Defendents house with the Fi FA in hand however she denied she owned anything in the house (2 houses). What could be my next step?
Already tried to garnish from the bank, she moved the money.
Re: Fi-Fa is the Writ of execution - Posted by michaela-CA
Posted by michaela-CA on February 11, 2008 at 07:21:13:
so, how come all of the properties I dealt with in Atlanta had fifas that were years and years old, but properties weren’t being auctioned off? I do have to say those were vacant lots. I’m under the impression that the County is so far behind in their tax foreclosures that they pick and chose. And vacant lots are on the bottom of their list. Unless they get pushed they don’t do anything.
Posted by michaela-CA on February 09, 2008 at 17:53:41:
Kristine,
I also want to make sure that we’re on the same page. In Georgia there are the tax liens, which are called Fifas there, which can be purchased as I had written. Then there are tax auctions at which investors can purchase the deed, which allows 1 year of redemption by the property owner. If not redeemed in that time, the investor owns the property, but will probably have to go through quiet title in order to be able to get title insurance or owuld have to let it mature for a certain number of years (I’m thinking 5, but I may be wrong)