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Over the years I have had quite a few people ask me for a “quick” step by step guide that would help them become successful in the tax sale business. My response is always the same: Learning how to invest in tax sale properties takes time. I teach a course with hours and hours of trainings and provide hours more to many students through private coaching. There is nothing “quick” about becoming successful in any business.
What I am able to do, however, is provide the five steps necessary to put you on the path toward tax sale success.
Step 1: Prepare yourself! Imagine this: Someone decides one day they want to become a heart surgeon but doesn’t want to go to medical school. So, the next day they show up at the hospital, walk into the operating room, throw on a pair of latex gloves and start operating on a patient! That’s insane, right? Of course it is!
Although heart surgery and tax sale investing are two different things both do require training and preparation. It’s important that you take the necessary time to learn as much as you possibly can about tax sale investing before you get started. Tax sale investing is NOT a business you can just stumble into and start making millions. It takes time to learn the business and the proper investments strategies that will make you successful. You MUST take the time to learn or you will never have a chance to reach the success you desire.
Step 2: Develop a plan! Tax sale investing is a business and needs to be treated like one. Just like any business, you should develop a business plan. It could be as simple as a few paragraphs or 30-40 pages long. But you should know how you see your business progressing and what the objectives of your business are. A few things to consider are the areas you’ll invest in, when you’ll expand those areas, how you’ll sell the properties and when you should take any proceeds out of your business. If you have a business partner or spouse this is also a great time to make sure everyone is on the same page and to bounce ideas back and forth.
Step 3: Research! Research can be the most difficult thing to master when it comes to investing in tax sale properties. Coincidentally, it is also the most important thing. We will never be able to emphasize enough just how important it is. Research is everything when it comes to investing in real estate! We teach our students how to use dozens of tools and strategies for their research. Many of these tools and strategies do take time to master and become efficient at, but research is something that will become easier with experience. With that said, as a company whose researched hundreds of thousands of properties it’s extremely important to be diligent and focused on every single property you research. It’s possible you’ll come across one that will make you a millionaire while another will cost you a million dollars in lawsuits!
Step 4: Buy & Sell! This is the obvious one and they are lumped together for a reason. Once you are taught correctly, buying and selling properties is actually the “easy” part. Granted, it might take hours of training to get you to the point where you are comfortable and knowledgeable buying and selling properties, but eventually you will reach that point. We always teach that you make money when you buy the property, not when you sell it. Your goal will be to buy properties at such deep discounts that you can actually sell under market value, make a substantial profit and then move on to the next property.
It’s also important not to force yourself into an investment and to be very patient. Many beginning tax sale investors put time limits on when they should start investing or when they should buy their first property. While it is important to take action, rushing yourself into an investment has disaster written all over it.
Step 5: Grow your business! Buying and selling one tax sale property usually won’t make anyone successful beyond their wildest dreams. It’s important that you continually work on growing your business. When you sell a property reinvest as much as you can of both the initial capital and the profits into as many properties as possible. Eventually you’ll get to the point where you’ll be able to purchase 50 or 60 properties at a time, which will lead to an even bigger payday for you.
Obviously if you need to take some money out to live by all means do so. The idea here, however, is to roll each successful investment into additional successful investments. This will allow you to grow your business and your wealth!