Lien Certificate- An Instrument For Making Money And Getting Ahead Of The Crowd
Have you ever thought of moving away from the traditional banks savings and US federal government savings bonds? While these savings are risk free investment, you end up earning peanuts on your investments as the interest offered is dismal. Also as there is no capital appreciation, there is no wealth creation. It is here that investment in lien certificate may prove to be quite a change in your wealth management technique. Let us have a look at the opportunities offered by this sector.
Every year, counties face the prospects of depleting resources due to default by property owners who fail to keep date with their tax obligations. The only option available to the counties other than going broke is to somehow sell these defaults to persons who are willing to assume the responsibility of paying such taxes on behalf of property owners.
These defaults are sold by the governments by way of tax lien certificate and the buyers of these certificates get a right to recover the taxes due from the defaulting owners. They also have an option to foreclose on such certificates if the recovery is not made by the due date.
Investment in tax lien certificate is an intelligent investment strategy especially if you are aware of the tremendous opportunities offered by the sector. These bonds are sold by the governments hence you save a lot of intermediation cost, which is generally applicable in other forms of investment such as shares, government bonds and derivative instruments. Also the capital required to invest is miniscule compared to other investment tools. Tax lien certificate follows a prescribed annual or half yearly sale procedure followed by most of the counties. You may get the required details by visiting the websites or from the local offices. Go through the procedure and satisfy yourself about the risk factors and what it entails to invest in lien certificates. You may end up earning a lot more than what you have been earning for years on your bank deposits lying idle for so long. Lien certificate does not give the buyer an ownership right in the property. In that way, these certificates are different from tax deed certificates, where the actual property is auctioned by the government to recover its dues. Here the buyer of the deed is the new owner of the property and can exercise all the rights in respect of his acquisition. However it is good idea to do a survey of the property in respect of which you are buying the lien certificate or a deed certificate to avoid the future complications. This is because in most of the cases, the counties do not vouch the ownership title of the property put on the block for issuance of these certificates.
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