August 25, 2022
We buy houses acquired through tax sales
Have you acquired a property through a tax sale that you are looking to sell? While the title insurance is a little more expensive on these properties we are still happy to buy them. Like this one in Marrero. Watch the video to hear our founder Steve Keighery talk about the process or read the transcript below.
Hey guys, it’s Aussie Steve here from Home Buyer Louisiana. We buy houses in any condition in Louisiana. I’m here at a property we’re looking to purchase. This is our first inspection on it, actually. So, we haven’t gotten a contract yet, but we’re having a look at it. So, the seller reached out to us. They actually bought this at a tax auction.
Here is how a tax auction works. If you don’t pay your taxes, the city will auction the property off, and people can pay the taxes on your behalf and you need to pay them back with interest. It’s 5% the first month and 1% a month after that. And as long as you pay it back within three years, the property is still yours. You pay it back with interest to pay off the tax lien. So, the person who bought the taxes, they get a return on their investment, but if you don’t pay it after three years, they can sue and actually get the title to your property. And the three years is if the house is inhabited. It’s only 18 months if the house is vacant, or it’s vacant land.
So, it’s really important you pay those taxes, and if you are in a position where you are close to those three years, you should sell the house. If you can afford to pay the tax, please do. But if you can’t pay it, you are better off selling the property so at least you can get some of the equity. The person who got it from the tax auction most likely didn’t pay the value in tax. The tax is in most cases worth a lot less than the property. And if you don’t pay the tax off, they’ll get the property for just that tax money, and you get no equity. So, if you find yourself in a situation where you’re owing taxes, and you can’t pay it off, you should at least sell it before the 3 years comes up.
We can buy the house, and you can use the money we use to buy it to pay off the taxes. That way, you get to keep the equity in your house. That’s better than losing the house if you can’t pay the taxes.
This didn’t happen in this case. We didn’t speak to the seller. So, we’re actually speaking to the person that had paid the taxes and have now actually filed the suit. They now own the property. I’m not sure who owned it before, I don’t know the story, but the person who paid the taxes now owns the property and they’re looking to sell it. So, we’re looking at it to potentially buy it.
It’s pretty obvious that the house needs to be sold as is. The people who bought the taxes are professional investors and they can fix up the house and sell it, but in this case, they’re just happy to sell it as is to someone else like us who will do the work, and unlock the value. They will still make a good profit selling it because they got it only for what the original owners were owing for tax. Then we’ll come in and we’ll fix up the house, add the value and then we can sell it or turn into a rental.
So that’s how that’ll work. We buy houses in any condition as is. If you’ve acquired a house through tax auction and you intend to sell it as is, we can buy it. But ideally, if you’re someone that owes taxes, sell it before the tax option is exercisable. For instance, if the seller had sold it to us beforehand, then he could have used the money to pay off the taxes and kept all the rest of the proceeds. So, if you find yourself in that situation, that’s a much more beneficial thing to do.
So, if you have a house you want to sell in as is condition, reach out to us. It doesn’t have to be a house with a tax lien. Possibly it requires some repairs, and you just want to sell as is, reach out to us. You can check out our website, HomeBuyerLouisiana.com. You’ll see lots of information in there about selling your home. We are also happy to chat with you about your circumstances.
Thank you so much, guys. Have a great day.
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