My Tax Lien Story.

About 15 yrs. ago, I found out about tax lien investing here in Cook County, IL. It is one of the largest counties in the USA. I found out about the details, put a deposit down so that I could bid. I then got the list ahead of time and drove around researching properties. I mainly was matching up the tax id with an exact address. I decided that I would buy just 1 tax lien to “get my feet wet”. I had 10 on my list that were what I deemed okay to bid on (tax id matched up with a real address).

The first day I bid, I sat near the front of the room. To my surprise on day 1 (they have about 3-4 days of bidding since the county is so huge), there were only about 15 people in the room. Since Cook County is so huge, I was surprised at how few people were there. Each time I would bid 18% (that is the best amount of interest you can get), someone else would bid me down. I came to realize that these bidders were actually representing large corporations and were there to bid on many properties. I also found out that they purposely bid down novice bidders to discourage them and hope that they would go away. The reason I came to that conclusion was that the big bidders would not bid against one another, but when I or another novice bid, they would bid us down. I just let them win because I was determined to get the lien at 18% and NO LOWER.

The 2nd day, I decided to sit near the back of the room, and when the property was called out by the auctioneer and I said “18”, I saw the large bidders turn around to see who it was, but just before they could open their mouth, it was sold to me. I won and I was so happy. This was in January. By April, it was redeemed. So I got my money back + 18% in 3 months. That comes to 72% annually. I never did another one as my life just got so busy.
What people don’t realize is that this takes time. I drove by about 50 properties before deciding on the 10 that I ended up to be okay to bid on. This took a whole 8 hr day, plus the 1 day going to the courthouse researching if there were any other back taxes. I also had to research the State of IL. laws and any specific county laws. For example, in Cook County, once you buy the lien, you then have to post notice in a newspaper after 6mos. and then 12mos. etc. If you don’t do this, you have no chance to secure a deed later. Fortunately, my lien was redeemed in 3 mos. so I didn’t have to post notice.
Now that I have more money and some extra time, I want to invest again in either tax liens or tax deeds. I heard that Iowa pays up to 24%.

What is the very best tax deed/lien investing course or book to buy to help me?


I started in Tax Lines in 1988. Yep, been at it a long time. Excellent way to get high interest and penalties on your money.

NOT A GOOD WAY to try and get property.

Back then and up until about 2000 or it it was a gentleman’s game, Lots of nice people and nice bidding, etc.

Now it has become a “Dog-eat-Dog” business as major financial institutions take in investor $$$ buy tax liens and pay investors a share of the profits.

It is not uncommon now to see liens bid up to very high.

Locally we have a man who admittedly is bidding for a hedge fund. He comes i with at least $3,000,000.00 to spend, Very arrogantly bids up everything he wants.

He says they are making money, However I doubt they are making the profits he thinks they are.

He is a good example of the high dollar financial people in the game now.

Education: Google tax liens and you will find literally thousands of sites.

All will want you to invest in their courses.

Probably none will be for Cook County, Illinois.

Best bet is go to local courthouse law library and get librarian to make copies of all the statutes for your state. Go home read them at least three times to get past the legalese.

Get familiar with Jones vs Flowers a SCOTUS case.

Start small as the water can be very deep. Most properties that go up for tax lien are not worth the lien.

You can buy leftover right of way, crack houses, overgrown wooded lots, swamp land, lots too small to do anything with, old condemed buildings, etc.

Your chances of getting the $289,500 house for tax liens are better for the powerball lottery.

Good Luck

Bill, I’ve seen you post this before. I think for now I will invest in Illinois Tax Liens (the state I live in). I read the statute and if the owner redeems from the date of the sale (when the tax lien was sold to investor) until 6 months later, the investor gets whatever he bid and won at the tax sale. So in my case it was 18%. If the owner redeems in months 7-12, the investor gets 2X the penalty bid, so in my case if the owner had redeemed in month 7, I’d get 36%. It looks like Illinois is a good state for investing in tax liens. Obviously, as tax lien investors, you cannot get “caught up” in the bidding. If some large buyer wants to bid you down, just have a floor in mind. For me, I won’t take less than 16%. If the large investor wants to bid lower and get it, he is welcome to do it. This insures that it is worth my time. Also, the savvy tax lien small investor needs to physically drive by and match up the tax i.d. with an actual address, so that he knows what he is bidding on. Doing those 2 things are the most important I believe.

Sounds to me like you have EXACTLY the right frame of mind and BUSINESS Acumen to get into the tax lien business.

It is, just like other real estate, fraught with possible problems.


Good Luck, be very careful as the water can be very deep.