This collection can be achieved by a tax auction. That brings us to the
question What is a Tax Lien auction? A Tax Lien auction is a court-ordered
auction. Depending upon the state and the nature of sales it can be an auction
for tax deed sales or tax lien certificates.

 In case of an auction for the tax deed, the property is sold to satisfy
the existing delinquent taxes. An auction of the tax lien certificate involves
selling a certificate to claim the total sum of taxes owed and any
administrative charges and interest on the amount owed.

If you purchase a tax lien certificate, you are required to make the payment
against the required property taxes for the delinquent taxpayer. In turn, the
delinquent taxpayer is required to pay back the amount of the lien plus interest
charges, usually 16-18%, to you.

This allows you to have two options a higher percentage of interest in case
the repayment is made, or the possibility of the deed of the concerned property
if the delinquent taxpayer fail to repay. A court-appointed referee carries out
the auction. At the beginning of the auction, the referee announce the terms of
the sale, the required deposit to be made at the auction.

Usually, you are required to pay 10% in form of a certified check which are
payable to the referee. Remember, the properties sold in these auctions are sold
"AS IS, WHERE IS, WITH ALL FAULTS".

Even if a property is under a tax lien foreclosure, you do not get right to
enter the property for an inspection. You are required to place your bid
accounting this uncertainty. You should investigate the property as best you
can, but you cannot inspect the interior prior to the sale.