The Power of a Customer’s Opinion

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There can be no greater recognition of the achievements of a company than the sage words of its customers.

The effect on the team here at CTS when we received the kind words of a recent customer was noticeable. As much as we know we are trying our hardest to satisfy the requirements of every customer, a testimonial is the final confirmation that we are reaching our goal.

But rest assured, we treat each kind expression of gratitude for what we have done as a stepping-stone to the next level of customer service.

With thanks to Lewis, Escambia for these kind words:

I want to thank you and the cleartosell.com (CTS) team for your great work.  I am very impressed with CTS in terms of its responsiveness, “time-to-market” performance, and professionalism.  In my experience CTS has actually understated its performance in its marketing and on its website, and that’s pretty unusual in my 30+ years of business experience!

Thanks so much.  I look forward to working with you again, and soon.

January 15, 2015

Posted In: Testimonials


Improving the balance sheet of Tax Deed investor

pic12So you’ve been successful in bidding for a tax-deed and now are the proud owner of an asset that cost you less than you expect it to be worth.  If you have any doubts about the future value of the asset being higher than the cost to you, you shouldn’t be investing in tax deeds in the first place.

Assuming you are performing appropriate due diligence, you will have a grasp on the physical condition of the property (your asset) and its occupancy status.  So you will have budgeted for your post-acquisition costs to either resale or let the asset and have an expectation of realizing more in income than the costs – this is your return on investment.

But until the title has been cleared of the clouds that the tax-deed due process inevitably creates, your asset is only worth your costs.  Your investment balance sheet has zero worth.  Indeed, until you know the title is clear, the asset value is probably less than the total of cash you have spent on it.

Pro-actively clearing the title on your tax deed assets directly after acquisition means you can be sure of the future value, and your return.  In this situation your investment balance sheet is in profit by the margin between the costs of acquisition and rehab, and the value to be realized at sale.

By improving your balance sheet position, you also open the possibility to leverage your assets by borrowing against them and using those borrowed funds to buy more property.

Thinking about your tax deed assets in terms of your balance sheet is a great way to be clear on your investment gains and losses.  Don’t wait until you come to sell an asset to know that it will give you a return on your investment, or leave you with a loss.

November 20, 2014

Posted In: Tax-Deed


What chance for real tax-lien reform?

pic51With control of both houses effectively in the hands of the Republicans, cleartosell.com looked for signs of an appetite for reform to the 100+-year old principles behind tax liens and the foreclosure that can follow.

There is little clarity on any tax reforms that the Republicans plan beyond wanting people to keep more of what they earn whilst recognizing the deficits that need to be met by taxation income. So it looks like a continuance of the dilemma of modern politics.

Although you would think that a Republican controlled legislature would move to streamline the real property tax collection process, we are mindful of the Democratic controlled White House. Even if there is a change of control of the White House in two years, we discovered a couple of instances of blustering over the morality of the tax lien laws that may impact any real change:

Firstly, just over a year ago, The Washington Post reported on changes that Democratic Mayor Vincent C. Gray had made to the tax lien process to protect people from loosing their homes over trivial tax debts. The changes did not reduce the liability of the homeowner to pay the back taxes and additions, but it did remove the opportunity for investors to take ownership.

And secondly, in 2012 The American Bar Association published, through its BiFocal Journal gave a damning account of how seniors and the disabled are at unacceptable risk of loosing their homes through tax deed foreclosure.

From what we can see, these are isolated protests that are not indicative of change that would negatively affect investors. But the early stages of a moral revolt against the tax lien system cannot be denied.

So for now, we can conclude that the landscape for tax liens and foreclosure will remain without change, but we will keep watching and report any proposals we find.

November 14, 2014

Posted In: Tax


Reducing the risks of tax-deed investing.

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The concept of Try Before You Buy works when you are purchasing a new car or some furniture.  But it has always been difficult to put into practice when you are buying property.  You can visit a house and walk around it to get a sense of the suitability of its size, layout, condition and location, but you don’t really know what it is like until you own it.

When buying a home to live in, emotional factors can equal the hard facts in deciding on which property to buy.  For tax-deed investors, there is no room for emotion.  It is all about the facts of the property on which you intend to bid.

Due diligence is conducted by tax-deed investors in three different ways.

The professional investor – This group will have developed their own systemized approach to gathering data on the properties at auction involving online and on-the-ground research into location, condition, prevailing sales and rental markets and recent transaction evidence.

The regular investor – Here is a group that are no less concerned with the facts than a professional investor, but which lacks the time to conduct all the due diligence themselves and may well out-source the gathering of data to a company that specializes in distressed property appraisal……or just not dig quite as deep.

The occasional investor – This group will take a cursory look at the basics, principally online, and rely on an element of luck.  They are generally bidding with cash they can afford to lose and approach their investment with a more relaxed approach.

Whichever group you fall into (and there may be more than those listed above), you understand the importance of some level of risk management before making bids at auction, because whatever amount of due diligence you do, you are doing it to control your exposure to losses.

Post auction, when you have out-bid the competition and own a tax-deed property, there are generally two different paths – you are flipping or holding.

But what about clearing the title?  It is presumed during due diligence, and when bidding, that you are investing in something that cannot be easily traded (whether holding, refinancing or selling on).   Here is a risk that is just accepted.  Historically your choices have been to either hold out the four year statutory period before title can be consider clean (and run all the risks associated with property ownership), or pursue a costly and time consuming quiet title action.

In recent years, a third option for cleaning title has been developed – certification of title insurability based on research.  This is quick (cleartosell.com is averaging ten days to certify) and cost effective, certainly cheaper than a quiet title action.

With the availability of title certification comes the opportunity for investors of all standards to extend their systematic approach to investing to include title certification directly after auction.

The benefits of being free to refinance or resell your investments a few weeks after acquisition are considerable.  You may still choice to hold the investment for a period of time.  But you do so in the knowledge and comfort that your options are much greater if title has already been cleared.

The five stage end-to-end plan investors should adopt to reduce all the substantial risk in their investments is:

due diligence – bid – win – certify clean title – flip/hold.

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Don’t leave the risks of poor title in your investments until the last minute.  A proactive approach to title certification will add substantially to your returns on your investments.

November 5, 2014

Posted In: Tax-Deed


Will you play hold or raise with your tax deed investments?

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Many tax deed investors buy with the intention of holding their investment for four years in the hope there are no challenges to their title. If after the statutory period they have clear title then their options open up to refinance or sell on. But there are alternatives to holding property for four years that can represent a significant raise in your investment game.

Whether you are a serial investor who has built up a portfolio of tax deed properties that you are holding, or just have one property, you carry all the risks. That risk is in the day-to-day costs and expense in owning the homes including maintenance, repair and replacement, taxes, windstorm insurance, HOA dues, rental difficulties and on top of that you are betting on volatile market conditions to preserve the capital in your investment.

If you can quickly and efficiently clean the title of your tax deed properties you create the opportunity to release your capital to reinvest and, crucially, know that your title is secure and unchallengeable.

With a clean title you certainly have the option to sell on your investment property. But what about the refinance route? With clean title, you can refinance your investment at the current historically low rates, not only releasing the capital you used to buy the property, but also to release the cash you have tied up in rehab work. After refinance you get to keep the property in your portfolio if that is what you wish AND are back in funds to buy more.

By working with cleartosell.com to access our innovative, time saving and cost effective systems that determine the clarity of title in 20 days, in just a month from now you can be ready to release your capital and raise your investing game.

October 22, 2014

Posted In: Tax, Tax-Deed


Quiet title action takes too long and costs too much

Quiet Title Quiet title actions were not originally designed for the complexities of debarring those clouds that can be found on title after a tax deed sale.  It is a judicial process intended for much simpler resolutions of title issues such as incorrect entries on title deeds, or incorrect spellings, dates, etc.

Because of the foreclosure debacle, the due process of quiet title actions has been stretched to the limit.  In recent months, we are seeing judges apply far more scrutiny to each case.  We frequently see judges requiring extensive evidence of the attempts to serve related parties before they will allow service by publication.  We are finding it necessary to not only evidence that we have tried to serve related parties at their primary home, their second home, their place of work and anywhere else they could plausibly be; but also to evidence that these attempts to serve have occurred at varying times of the day, and in some cases multiple times of the day and night.

All of this means that the costs associated with quiet title action are rising dramatically, and the time periods from start to finish are extending beyond reason – with many cases now spanning a year or more.

Quite rightly, attorneys can only give a flat rate quote for their professional fees and then must recoup their costs and expenses on top.  These costs and expenses are unknown and can vary greatly depending on the number of related parties, and the complexity of service of process.  One recent case required the service of process upon 16 heirs spread across the US and Europe.  We are aware of cases where the attorney’s fees have been doubled by the costs and expenses.

So what can be done?  Well, if quiet title action is your preferred way forward, then at least get a good estimate of the total time and total costs before you instruct your attorney.  Insist that a Foreclosure report be studied to assess the number of related parties.  This will help to estimate your costs, but you will still be at risk of significant cost escalations if the attempts at service become complex and protracted.

Our view?  Quiet title actions will become too expensive and too time consuming for those with a desire to turn a profit from their investment in a tax-deed property.  Faster and more cost effective ways such as www.cleartosell.com will emerge as the normal procedure.

October 14, 2014

Posted In: Quiet Title, Tax-Deed