BadDecisions
Silver Member
Does this require some kind of screw up on the part of the township to charge the wrong person taxes? Or accept payment from them?
IANAL definitely applies here, but I'm betting all the websites talking about it are leaving out one key detail on the paying taxes issue - tax lien sales.
Here in Arizona, the city/county/state conducts a once a year auction for tax liens. While I don't know the specifics for other areas, I'm sure there's something similar everywhere. When you win an auction, you pay the back taxes, but you don't automatically get title to the land. The land owner then has a certain amount of time to repay you plus interest to retain the property. If they don't meet the deadline, you can then proceed with foreclosure and eviction proceedings, which is an additional cost and time.
My understanding is that the overwhelming portion of the auction sales are from investors that are just in it for the interest payments, and have zero interest in getting land on the cheap. I've looked at the auction listings a few times, and it seemed 99% of the parcels are garbage properties. Tiny parcels literally in the middle of nowhere with zero access, no utilities, etc or completely dilapidated property in the middle of the ghettos, etc. Which explains why the sales are all investors - buy a crap load of liens with the hope that a few pay out enough to cover the rest. Those that don't pay out just cycle through the auctions again in a few years.