as it budgets the money from taxes for their services. Thus, the solution they have come up with is offering the taxes to investors in the form of a lien.

Don’t know how this all works so perfectly? Well, an investor pays the government the owed tax at the auction and then, when the property owner goes to pay off the tax lien, they pay the county. It is then the county that pays the investor for the amount of the principle investment plus a penalty. It is that simple!

Tax liens vary from state to state and can range from 5 to 300 percent on an investment. But don’t get all happy about it, as once you buy a lien, your money has very little liquidity. This happens because an investor cannot make their payment until the property owner pays off the tax.
If he does not pay off the lien, then you have the first rights to the property. This is because the laws ensure that your lien will be paid off first. For example, if a bank has a mortgage on a property, if they don't pay you off it is all lost if you foreclose on the property and claim it.

Should you have the second lien on a property, you no longer own the first position. In this case, if a person wants to foreclose on a property, he must first buy out the lien from you, that is by paying off your tax lien first.

Property Liens Check for Liens Before Buying or Selling a Home. Valuable Information for Anyone Looking to Buy or Sell a Home.

Here are some more accountant articles...