Essentially tax foreclosure properties belong to the local government. For whatever reason, the homeowners did not pay their property taxes as required by the law in their area. Sometimes homes can be taken for failure to pay other types of local taxes, too. The specifics vary from county to county throughout the United States.
After a number of notices are given regarding the past due taxes, the property is seized and is usually auctioned off by the government.
Going to Auction
While bank foreclosures rarely sell and auctions and end up becoming REO properties that head back to the market after some repairs, tax foreclosure properties are almost always sold at auction. If they are not sold the first time, they go back on the auction block during a subsequent auction.
That means if you're serious about obtaining one of these properties you need to find out when the auctions are occurring. In most counties, tax foreclosure properties are auctioned off once a month. You can contact your local tax office or sheriff's office (these types of auctions are often referred to as sheriff's auctions) to find out when the date is scheduled. However, if you're interested in finding properties outside your home area, using the Internet might be a better choice for your search.
Which is Better?
There are pros and cons to both bank and tax foreclosure properties. You'll want to weigh these pros and cons before making a choice about which to pursue. Of course, if you're an investor you might want to keep all of your options open so you can secure the best deal possible.
