Zero Risk Real Estate: Creating Wealth Through Tax Liens and Tax Deeds

Over-The-Counter Bargains

So what if the auction is over and there are parcels left that didn’t receive a bid? Or what if someone did screw up, and it wasn’t caught until after the auction had ended? These parcels may still be available!

Be alert at the auction, and always stay until the end. If parcels are not paid for when due, it invalidates that auction item, and it may come up later in the day. Unpaid or unsold tax sale items can become available as what is known as an OTC (over-the-counter) or Assignment Certificates within a few days. Just because a parcel didn’t sell doesn’t mean the county doesn’t still want to sell it.

In some cases, the county may hold what is known as a cleanup auction to sell these remaining items. At the cleanup sale, the minimum bids are usually eliminated or drastically reduced just to get them off the county books. In Indiana, these are known as Commissioner Certificate sales, and on those, the rate of return on a redemption actually goes up to 30 percent! I’ll talk more about those in Chapter 8.

If it was an onsite sale, you can obtain a list of these OTC liens/properties directly from the county after an auction has taken place. For online auctions, they may simply relist the items at a later date.

These OTC liens are like going to the store and buying yesterday’s bread. It isn’t as if the bread has suddenly gone bad and has no value, it’s just that no one actually bought it the day it was made. So because of this, the store sells it at a huge ...