Transcript:
Welcome to the Tax Sale Podcast, where tax sale investing is made easy.

I’m Casey Denman, a tax sale veteran, expert, and trainer, author of the tax sale playbook, founder of the tax sale academy and your host here on the tax sale podcast.

Thanks for joining me on today’s podcast, and as always, at the conclusion of this podcast, if you’re looking to learn more about investing in tax defaulted real estate head to taxsaleacademy.com. That’s taxsaleacademy.com.

How much money do you need? Sounds like a simple enough question, right? Unfortunately, it’s a question that I can’t directly answer. I touched on this briefly in a podcast episode a couple of weeks ago – it was titled Developing Your Tax Sale plan and you can listen to the entire podcast by going to TaxSalePodcast.com

In today’s video, I want to expand on it that topic a little bit. How exactly should you set your budget as a tax sale investor?

Let’s go over a very 3 step process to set your budget . . .

Step one:
Determine what type of investment you want to make – and take into account expected time and your expected effort. Do you want to invest in tax liens or tax deeds? I’ve got videos about the differences, but in short tax lien investing is where you’re buying a lien against a parcel of real estate in exchange for paying their taxes and earning a return. Tax deed investing is where you’re actually buying a property that has been tax foreclosed. So a lien is a a lien against a property and a tax deed is the ownership deed to the property. Generally speaking, a lien will provide a smaller return and will require less work. A deed will provide a larger return and will require more effort since it must be sold in order to capitalize on your investment. So figure out if you have to invest in liens or deeds. You can obviously invest in both, but in order to determine your budget, this will be the first step.

Step Two:
Now that you have determined whether you want to invest in liens or deeds, you can choose the best state for you. If you only want to invest locally, then you might have to adjust your decision in the first step. Or your decision in the first step might just now be concreted in. But typically speaking, if you choose one, liens or deeds, you’ll automatically eliminate around 50% of the states. There are a few states like Florida that are hybrid states that offer BOTH liens and deeds and then some states like Texas offer a redeemable deed which is kind of a cross between liens and deeds. What I suggest you do at this point is click the link in the description to take a look at the state guide on our site. The address is taxsaleacademy.com/state-guide, and again, there’s a link below. It’s a color coded map that you can sort through based on your preferences. Once you find the state, watch the video and do some research on the laws of that state.

Step Three:
Locate multiple counties in that state and browse through their previous auction results. In most states, the law requires that the auction results be available. Of course, they might charge you a nominal fee for copies or faxes, but they are typically going to be fairly easy to get ahold of – in fact, many counties will post them on their website. Once you get the auction results, look through them and analyze their sales prices. It’s possible that you’ll know immediately if every single property in that area is out of your budget. And that’s ok – some areas are expensive, just move on if so. Other areas, however, will show a wide range of prices, where many WILL be in your budget. For those properties in your budget, do some basic preliminary type research to determine what the actual property is and then decide if that property type interests you or not. If you don’t find anything that interests you or is within your budget, then move to another county. Then another and another. If you have to, choose another state. Eventually you’ll find multiple counties that have property types and a history that will suit your style and will help you determine precisely what your budget should be.

So, choose your investment type, choose your state, and then review specific county results. Pretty simple process to determine your tax sale budget.

If you’d like to learn more about investing in tax defaulted real estate head on over to TaxSaleAcademy.com. That’s TaxSaleAcademy.com.

And as always guys, if you found this episode helpful it will mean so much to us if you take a few second to leave positive feedback.

Take care guys and make it a successful day.

See ya!