How does a tax deed sale work?

A tax deed legally transfers ownership to the buyer of a property that has been sold due to delinquent taxes. In a tax deed sale, the property itself is sold. The sale which occurs through an auction has a minimum bid of the amount of back taxes owed plus interest, as well as costs associated with selling the property.Click to see full answer. Also asked, what happens when you buy a tax deed?A tax deed is a legal document that grants ownership of a property to a government body when the property owner does not pay the taxes due on the property. A tax deed gives the government the authority to sell the property to collect the delinquent taxes and transfer the property to the purchaser.Subsequently, question is, are tax deeds a good investment? Buying tax deeds is not a typical starting point for new investors, but it can be a lucrative investment strategy. This niche of real estate investing can be a great resource for buying properties at a steep discount and can be used if you fix and flip houses, own rentals, or simply want to earn a return on your money. Also asked, does a tax deed sale wipe out a mortgage? After a property tax bill goes unpaid, there is a tax lien certificate sale. This sale will wipe out all other liens, including mortgages, with the exception of other government liens. The winning bidder gets title to the property, in some cases, for little more than the amount of property taxes owed.How do you buy property at a tax sale? A typical process works like this: A property owner neglects to pay his or her taxes. A waiting period initiates. The unpaid taxes are auctioned off at a tax lien sale. The highest bidder gets the lien against the property. The tax collector uses the money earned at the tax lien sale to compensate for unpaid back taxes.