Recently I went to the tax sale in New Jersey. It was a very small tax sale in the small rural town. The sales tax was only about 7 & # 39 objects and I got 2 deposits are under 10 and 12 percent. This is not bad in today's competitive sales taxes in New Jersey. Usually, when such sales tax I leave empty-handed, as not willing to pay a premium for a small tax liens.
The majority of mortgages in the sale (all but one) were less than $ 600. In some states, local governments sell mortgage payments when sales taxes with taxes. All that is paid by the local municipality, can be sold as a tax lien for these tax sales. The majority of these mortgages were either for water or for sanitation violations. Only one mortgaged right includes taxes along with sewer crime and was just over $ 1,700. All the rest were either for water or for sewage or for both.
The last couple of years, New Jersey has been the trend represents a premium over these small mortgage funds. Investors are willing to pay a premium on the mortgage, to pay the following taxes. But small mortgage payments you are entitled to the following tax payments, but only following the sewer or water amounts that are significantly smaller tax amount. Keep in mind that in New Jersey the interest rate initially set to 0%, before the premium-author will be offered. Despite the fact that you get your prize back when laid pledge for 5 years, you will not receive interest on the premium rate or the amount of collateral. You will receive a small penalty in the amount of collateral and the fixed interest rate (18% if the taxpayer is $ 1,500 offenses, and 8% of this).
The fact that they were willing to pay some tax debt, to get these small mortgage means that almost got out of hand. Last year, I saw how they pay up to $ 1,500 premium to get a little 200 or $ 300 deposit. In fact, that's what they're doing such a small joint profitability of their investments, that this is not worth; especially for the individual investor.
Since I was able to buy 2 small deposits on decent interest rates during the last tax sale, which I attended? First I went to a small sell-off, which in the original list of tax were only 15 loans, and on the day the sale was only about 7 & # 39 objects. Secondly, in this sale was not really a big pledges; The largest – worth up to $ 2,000. Large screen brings the whole competition.
Third, you have to know when to stop trading. I was really lucky with this sale, because there was only one other participant in the placement of orders, representing the investment fund tax law. I offered each of collateral, except for one, but I did not offer him too far. If you are not greedy and insist on a proposal to set each collateral amount, the other members of placing requests can not put their loans into the bottom line.
Fourth, the fact that I was glad to get a piece of that sale. What I mean is that two real estate, for which I was laid, was the worst in the sale. One was owned by the bank and falling apart. This was not taken care of over the years. You can see his picture on the cover of this issue. You do not see this in the image, but it was also packed on the road and in the backyard with garbage and dilapidated, falling-down barn. The second house was vacant, and its plan to exclude from the bank. It was also a very small house without a garage, which was in need of TLC and a lot of updates.
If I chose not to do these tariffs on the & # 39; sites because of their condition, I would have missed a couple of good collateral and the only thing I could get. You should be ready to take that big boys do not want to or are willing to let go. These properties can be vacant and in terrible shape, but they are still good. The bank plans to buy them back at some point, but probably not until they sell, which can take a long time. This will give me time to subsequent payments for utilities (remember that it was a small mortgage payments add to my investments and earn more interest!