One of the states hardest hit by the housing bubble in recent years was Arizona. With foreclosures continuing to rise, the state of Arizona is not experiencing a bounce back yet, and most pundits believe it will be years before a recovery happens.
Along with the depressed housing market and overall economic downturn comes a rash of property tax defaults. According to Maricopa County Treasurer Charles Hoskins, the number of tax-defaulted properties almost doubled between the years 2008 and 2010. This year, the county expects 80 million tax lien certificates to be sold at auction in order to lessen the impact on revenues needed for civil services such as the school system, police and fire departments, and libraries.
In Arizona, tax lien certificates are sold through a reverse auction with interest rates starting at 16 percent. The average rate secured in the bidding process is 10 percent.
The property owner is given three years to bring the taxes current before a tax lien certificate purchaser can apply to the court and obtain a deed to the property. This situation is still rare, however. In the majority of cases – and estimated 99.9 percent – the investor gets their money back, plus interest, when the owner pays, the real estate is sold in a short sale, or the mortgage company takes the property back.
If you want to get in on Arizona tax lien certificate investment opportunities, you can enter the auction online and submit your bid through the county treasurer’s website. Although the state of Arizona schedules all tax lien certificate auctions in February, there are still opportunities to buy the leftovers throughout the year.
Great blog post. It’s useful information.
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