Maine Tax Sale
§1071. Collector’s tax auction sale; notice; procedure
If any tax on real estate remains unpaid on the first Monday in February next after said tax was assessed, the tax collector shall sell at public auction so much of such real estate as is necessary for the payment of said tax, interest and all the charges, at 9 o’clock in the forenoon of said first Monday in February at the office of the tax collector or at the place where the last preceding annual municipal meeting was held. In case of the absence or disability of the tax collector, the sale shall be made by some constable of the municipality who shall have the same powers as the tax collector.
In the case of the real estate of resident owners, the tax collector may give notice of the sale and of his intention to sell so much of said real estate as is necessary for the payment of delinquent taxes and all charges by posting notices thereof in the same manner and at the same places that warrants for municipal meetings are therein required to be posted, at least 6 weeks and not more than 7 weeks before such first Monday in February, designating the name of the owner if known, the right, lot and range, the number of acres as nearly as may be, the amount of tax due and such other short description as is necessary to render its identification certain and plain.
In the case of taxes assessed on the real estate of nonresident owners, he shall cause said notices to be published in some newspaper, if any, published in the county where said real estate lies, 3 weeks successively, such publication to begin at least 6 weeks before said first Monday in February. If no newspaper is published in said county, said notices shall be published in like manner in the state paper. He shall, in the advertisements so published, state the name of the municipality and if within 3 years it has been changed for the whole or a part of the territory, both the present and former name shall be stated; and that, if the taxes, interest and charges are not paid on or before such first Monday in February, so much of the estate as is sufficient to pay the amount due therefor with interest and charges will be sold without further notice, at public auction, on said first Monday in February at 9 o’clock in the forenoon at the office of the tax collector or at the place where the last preceding annual municipal meeting was held. The date of the commitment shall be stated in the advertisement.
In all cases said tax collector shall lodge with the municipal clerk a copy of each such notice, with his certificate thereon that he has given notice of the intended sale as required by law. Such copy and certificate shall be recorded by said clerk and the record so made shall be open to the inspection of all persons interested. The clerk shall furnish to any person desiring it an attested copy of such record, on receiving payment or tender of payment of a reasonable sum therefor; but notice of sales of real estate within any village corporation for unpaid taxes of said corporation may be given by notices thereof, posted in the same manner, and at the same places as warrants for corporation meetings, and by publication, as provided.
No irregularity, informality or omission in giving the notices required by this section, or in lodging copy of any of the same with the municipal clerk, as required, shall render such sale invalid, but such sale shall be deemed to be legal and valid, if made at the time and place provided, and in other respects according to law, except as to the matter of notice. For any irregularity, informality or omission in giving notice as required by this section, and in lodging copy of the same with the municipal clerk, the tax collector shall be liable to any person injured thereby.
§1074. Sale; procedure; costs
When no person appears to discharge the taxes duly assessed on any such real estate of resident or nonresident owners, with costs of advertising, on or before the time of sale, the tax collector shall proceed to sell at public auction, to the highest bidder, so much of such real estate as is necessary to pay the tax due, in the case of each person assessed, with $3 for advertising and selling it, the sum paid to the printer, 25¢ for each copy required to be lodged with the municipal clerk, 25¢ for the return required to be made to the municipal clerk, and 67¢ for the deed thereof and certificate of acknowledgment. If the bidding is for less than the whole, it shall be for a fractional part of the estate, and the bidder who will pay the sum due for the least fractional part shall be the purchaser. If more than one right, lot or parcel of real estate assessed to the same person is so advertised and sold, said charge of $3, the 25¢ for each copy lodged with the municipal clerk, and the 25¢ for the return made to the municipal clerk, shall be divided equally among the several rights, lots or parcels advertised and sold at any one time; and in addition, the sum paid to the printer shall be divided equally among the nonresident rights, lots or parcels so advertised and sold; and the tax collector shall receive in addition, 50¢ on each parcel of real estate so advertised and sold, when more than one parcel is advertised and sold. The tax collector may, if necessary to complete the sales, adjourn the auction from day to day.
§1078. Owner’s right to redeem
Any person to whom the right by law belongs may, at any time within 2 years from the day of sale, redeem any real estate sold for taxes on paying into the municipal treasury for the purchaser the full amount certified to be due, including taxes, costs and charges, with interest on the whole at the rate of 8% a year from the date of the sale, which shall be received and held by said treasurer as the property of the purchaser aforesaid. The treasurer shall pay it to said purchaser, his heirs or assigns, on demand. If not paid when demanded, the purchaser may recover it in any court of competent jurisdiction, with costs and interest at the rate of 8%, after such demand. The sureties of the treasurer shall pay the same on failure of said treasurer. In default of payment by either, the municipality shall pay the same with costs and interest as provided.
What are Tax Liens?
The collection of property taxes is a huge priority in every county in the United States. Literally, if the county cannot collect property taxes, they cannot pay for vital services.
To make sure this does not happen, the county places a lien on any property with delinquent property taxes and sells the tax debt to investors. This creates a win-win situation for everyone: the county gets their money, delinquent property tax owners get a little extra time to pay their overdue property taxes, and investors get a low risk, high return investment.
How high is the rate of return on tax lien certificates?
- Illinois tax lien certificates pay an annual return of 36 percent per year and if the lien gets redeemed early your annual return can be a staggering 216% per year.
- Indiana tax lien certificates pay an annual return of 15 percent per year and if the lien gets redeemed early your annual return can be a amazing 120% per year.
- Florida tax lien certificates pay up to an annual return of 18 percent per year and if the lien gets redeemed early your annual return can be a impressive 61% per year.
- Iowa tax lien certificates pay an annual return of 24% per year.
A few states like Georgia and Texas offer tax deeds with a right of redemption fee – that is, a flat fee of up to 25% regardless of whether the property owner redeems in one month or 6 months. This process is very similar to a tax lien certificate.
- Georgia offers a redemption fee to investors of 20%, if redeemed within one year. If the property owner redeems in one month, your effective annual interest rate is a stunning 240%.
- Texas offers a redemption fee to investors of 25% for most properties, when redeemed within 6 months. If the property owner redeems in one month, your effective annual interest rate is an incredible 300%.
- Delaware offers a redemption fee to investors of 15%. If the property owner redeems in one month, your effective annual interest rate is a spectacular 180%.
But what about investment safety, are tax lien certificates a safe investment?
Investing in tax lien certificates is ultra-safe!
Why?
1. State governments control the entire tax lien process so it is very safe and fair. The last thing the state wants is unsatisfied tax lien investors. Without the investors, counties would not be able to collect the money they need to keep the county government operating.
2. If delinquent property tax owners fail to pay their back taxes plus interest, they lose their entire property to the investor for the property taxes owed.
3. Tax liens take priority over almost any other lien, including the mortgage, so you are paid FIRST.
I am sure you can see why tax lien certificates are an incredible investment with a great built-in safety factor!
If the delinquent property owners pay their tax bill, you, the investor, make an extremely high rate of return on your money.
If the property owners do not pay their tax bill, you, the investor, get to keep the entire property for the taxes and penalties owed, often pennies on the dollar.
And the best part is that tax lien investing does not depend on the economy, so there is zero investment volatility when you invest in tax liens. In fact, there is more opportunity to make money in tax liens in this recession, than there is in a good economy!
Overall, you cannot find a higher return/lower risk investment than tax lien certificates.