Tax Liens VS Tax Deeds – Which One Should You Invest In?
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Because you’re reading this article I will assume you’re already somewhat familiar with tax liens and tax deeds. You also probably know that these are two of the most lucrative and rewarding investments available anywhere in the world. They’re in a class of their own.
The question is, which one takes the throne as the king of investments? Are tax liens better than deeds or is it the other way around? Let’s find out! But first, I need to ask you a couple of questions.
- Are you willing to travel to invest or do you strictly want to invest from home?
- Are you competent at selling a property?
- Do you want a hands-off investment that requires little of your time, or are you willing to be more active with your investing?
- Do you want to grow your wealth as quickly as possible, or are you OK with somewhat slower growth?
Your answers to the above questions will determine which investment is better for you. Tax deeds require more time and energy because you need to physically travel to the auctions to bid on the properties. After winning a property, you’ll want to do something with it, such as rent it, sell it, etc. This also takes effort. Not a lot, but some. The advantage to tax deeds is that you’ll make very large windfall profits. It’s not uncommon to pick up properties for between 20-40 cents on the dollar. This is mega bargain territory where big profits hide out. It’s well worth the extra effort.
Tax liens on the other hand are perfect for individuals who want to park their money and make great returns with little effort. You can invest in tax liens through the mail, making things much easier. Tax liens make investing easy. You buy a quantity of liens through the mail after doing some preliminary research and wait for the owners to redeem. When they do, you are issued a certified check, including very high returns.
It’s very easy. The downside is that the process takes time. You may sit on the liens for 6 months to 1 year before they pay off. This is OK considering the enormous returns you’ll make, but it’s not the fastest way possible to wealth.
What is my conclusion on where you should invest in? If you have some available time and capital to start with and want to make a fortune in the quickest amount of time possible, go with tax deed investing. If you want to beat the returns of the stock market, mutual funds, CDs, and other well-known investments with great ease, go with tax liens. Or, you can mix tax lien investing with tax deed investing. This is a great combination that will work miracles for your bank account.
No matter what you decide to do you will have a great and rewarding time with each of these investments. If you want to get started immediately, click on the link in the authors box below. This will put you on the right track!