This a resolved question found on Yahoo! Answers: Buy a home for $300 via Government foreclosure house sales – Is it for real?
I have just seen a TV commercial about government tax foreclosure house sales. They were claiming that you can buy homes all across the US for as cheap as $300 or less. Is this for real? There must be a catch does anyone know? However If there isnt a catch how do i get started.
Answer:
I’m sure theres a catch..i doubt you’ll get a house for $300…if that were the case all these houses in foreclosure would be sold..
Answer:
The system varies, but here is how it normally works:
Once a property has been delinquent in paying taxes for several years, the city/county will place it up for tax sale. At the tax sale, anyone can ‘purchase’ the property for the highest bid, always at least the amount owing.
However, notice I put ‘purchase’ in quotes? That’s because you do NOT get title to the property for some period. Usually, you will wait at least 1 year, during which time the owner has the right to reclaim their property by paying the amount owing. If they do, you get nothing.
So, let’s look at it this way. First of all, any mortgaged property will be claimed by the mortgage holder. They will not let a $100,000 property be sold for a few hundred dollars taxes. They will place the higher bid, or pay the tax bill and start foreclosure on the property.
Second, most tax sales involve much higher tax bills, since they involve several years of past due taxes, plus the taxes for the year of waiting.
Third: the VAST majority of tax sales do not proceed to a final sale. The owners will find the money, or accept their need to pay (many involve disputes with the county or city), within the reclaiming period. Face it, would YOU let a $100,000 property be taken from you for a few hundred or thousand?
So CAN it happen that you can buy a home for a few hundred? Yes, possibly. Is it at ALL likely? No way. Probably more likely you’ll be hit by a bus tomorrow. If it were possible, why would the people hawking this material not do THAT, instead of taking time to push it on TV?
The best way to make money on tax sales is to sell gullible buyers material that purports to teach them to make millions for doing nothing.
Answer:
I read a story about a house in Detroit that was sold for $1. However, it also had a lien on it for back taxes in the thousands of dollars. All the plumbing and wiring was stripped out by people who would then sell it for scrap. The windows were smashed or removed. The interior doors were stolen. It was basically a shell, and of course the interior was trashed by homeless people who were squatting there. It would cost several thousand to have it torn down. If a tiny city lot were worth more than 10-15k in that area, then it would be worth it to hold on to, but $300 certainly doesnt get you a liveable house.
Answer:
It did happen once. It was in 1968 and a real house sold for $300. Everyone was amazed. It never happened again so it is not fair for advertisements to keep “announcing” it like it was big news.
The theory is that the government takes possession thru nonpayment of IRS tax or other federal debts. There is an auction. It is advertised in the local newspaper. It is not a secret. (there are 3 big auctions advertised in today’s Phoenix newspaper). The highest bidder wins.
You don’t have to pay anyone to teach you how to do this. You go to the auction and raise your hand. If you win, you pay cash. Most of the houses sell for $60,000 or more.
