Tax Certificate Investing - A Fantastic Income Stream Or a Something Else - You Decide

Tax Lien Certificates are issued by counties for the nonpayment of property taxes each year. These Tax Certificates are sold as investments once or twice a year to anyone interested in owning them. A large number of these Tax Certificates are on properties with very little value (vacant lot, underwater, landlocked, not buildable, other government liens, etc). In many states a prerequisite to own Tax Lien Certificates, is the prospective investor must have a Social Security number, a Tax ID number or an Employer ID number. The counties are regulated by the state they are located in.

For years people have talked about this little known investment, but most people fail to do anything about investing in them. Tax Certificates pay an annual percentage yield up to 18% and much more. This type of investment has some similar characteristics as a money market account. But there are many things that make it a much different type of investment. A key difference is they are fully backed by the real estate associated with each individual Tax Lien; whereas a certificate of deposit is usually FDIC insured..

Tax Lien Certificates (or Tax Liens) are great investments for the investor who fully understands the risks and rewards of Tax Certificate ownership. Tax Liens consistently pay an interest rate of 18% annually and occasionally reward the investor with real estate for "Pennies on the Dollar" in the form of a Tax Deed. The key to this type of investment is the research required to understand about Tax Lien Certificates as a whole and to understand as much as possible about each property that you are going to invest your money in by purchasing a Tax Lien.

The novice must either hire someone to do his/her research or do the research him/herself. Self-help books, teaching compact discs and teaching DVDs are good for general knowledge information, but they could be quite expensive and they leave much to be desired when it comes to hands on experience. Public libraries and online searches are less costly and do a much better job teaching the novice about Tax Certificates. Another good teaching type is learning from a mentor who invests in Tax Certificates in the particular area you plan to invest in.

Everyone started out as a novice at one time or another, but if you follow these steps you will succeed beyond your wildest dreams. Do not invest in anything blindly -- knowledge is power. It is more important to receive a return of your money than it is to receive a good return on your money.
The novice must either hire someone to do his/her research or do the research him/herself. Self-help books, teaching compact discs and teaching DVDs are good for general knowledge information, but they could be quite expensive and they leave much to be desired when it comes to hands on experience. Public libraries and online searches are less costly and do a much better job teaching the novice about Tax Certificates. Another good teaching type is learning from a mentor who invests in Tax Certificates in the particular area you plan to invest in.

Everyone started out as a novice at one time or another, but if you follow these steps you will succeed beyond your wildest dreams. Do not invest in anything blindly -- knowledge is power. It is more important to receive a return of your money than it is to receive a good return on your money.