| If you're considering buying auction properties as an | | | | money back, plus interest - you do risk wasting your |
| investment, you may want to think twice. It's unlikely | | | | time and making a little in interest instead of a lot in |
| you'll be able to get one of these properties for as | | | | profit, which is the whole point. |
| cheaply as you may be thinking, and there are hidden | | | | The third isn't a risk so much as a negative aspect. |
| risks that make buying auction properties a distant | | | | There is simply too much competition at auction to get |
| second to buying tax foreclosure properties directly | | | | a really good deal on a decent property. Buying auction |
| from owners. | | | | properties is no longer a way to get a property for a |
| The first big risk of buying auction properties is that | | | | fraction of its worth. Good properties will sell for near |
| you aren't allowed to inspect the property beforehand. | | | | retail value. |
| This is fairly self-explanatory. If you can't see the inside | | | | The only surefire way to make a good return on a tax |
| (and can only see the outside by driving by), there | | | | property is by approaching the owner at the end of |
| could be serious problems that limit or eliminate your | | | | the redemption period (after tax sale). By then, |
| profit potential. Or worse - you could end up losing | | | | stubborn owners will be ready to deal, and lazy |
| money fixing whatever problems it has. | | | | owners will be ready to move on. It's during this time |
| The second risk you take is that you'll be paid off by | | | | period that you'll find owners who are ready to be |
| the owner during the redemption period. While this | | | | done with the ordeal and who are willing to sell you |
| doesn't pose a huge financial risk - you'll get your | | | | their deed for as little as a few hundred dollars. |