Upcoming Foreclosures

is the government tax foreclosure true?

I saw an infomercial on government tax foreclosures and how you can order an entire info package, but i just want to ask if this is true and ask how it works, are the houses really that cheap and if there is a catch.

Public Comments

1. It's mostly BS. Check with your local tax collector for local procedures. It won't cost you a dime to find out and they can get you on the mailing list for tax sale announcements. If you're expecting to get a $200,000 home for $3,000 worth of back taxes you'll be sadly disappointed. It's NOT going to happen.
2. The tax sales are in February so you can learn about this in person. If someone does not pay the property tax for 2 years, you can go to the Treasurer's Office and pay the tax. You are not giving them a gift. When you pay, the Treasurer marks a 2nd box called the "subtax". They enter your bidder number so the owner can not identify you. If the owner does not pay for 3 more years , you can hire an attorney and go to court to get the deed. But if you wait 5 more years, you can have the deed handed to you with no attorneys and no court. If the owner pays up, you get all your money back plus 16% interest. I have bought 40 of these and won't buy any more. All the owners pay up the tax. Sometimes i got my money returned 4 days after the sale. I got 16% interest for 4 days. It wasn't worth the effort. The only ones i got to own were ditches and alleys and slivers of land. I ended up losing money..
3. 1. You may have to report sale on Schedule D (Form 1040). 2. Any debt canceled is your income. 3. If you lived in the house for two years and owned it for two years in last 5-years, you may be eligible to exclude gain of up to $250,000. Read: http://taxipay.blogspot.com/2008/03/profit-from-sale-of-your-home.html 4. The Mortgage Forgiveness Debt Relief Act of 2007 generally allows taxpayers to exclude income from the discharge of debt of recourse loan on their principal residence. Read about foreclosure or repossession http://taxipay.blogspot.com/2008/08/foreclosure-or-repossession-of-main.html
4. I personally know people who have bought tax foreclosures in the Buffalo area. You can acquire properties for $3000- $6000 Dollars (some a little more) for properties that are worth $40,000-$70,000. Some of these properties are not in the best areas or are they incredible houses. With positive cash flows of $300-$600 a month . Kristian