I’m Ilyce Glink and here’s today’s real estate question: If I pay off the back taxes on a home, will I actually own it? Okay here’s your answer: not quite. Let me explain. If a property owner doesn’t pay the tax bill for a piece of real estate, the county assessor can actually sell the property to someone willing to pay the taxes. But in most cases, the investor who pays the tax bill doesn’t immediately get ownership of the property. Instead, the original owner has time to repay the investor the amount of the tax bill plus some interest rate, which is called redeeming the taxes. In many counties the owner has up to two years to bring the tax bill current and the investor might receive as much as 18 percent interest over that time. Now in an era where interest rates are at historic lows, 18 percent is a pretty awesome rate of return. And many people go into buying up properties at tax sales but aren’t really looking to take possession of the property. They’d rather have the homeowner redeem the taxes and earn a good return on their initial investment. Occasionally, there are situations where a tax sale may have been in error and the person that put up the money to buy the unpaid taxes at the auction may end up getting his or her money back, but they won’t get any interest on the cash. That’s not so good. If the taxes are redeemed, then the owner actually keeps the property. But if the two-year period elapses and the owner fails to repay the amount that’s owed plus interest, the title in the property would transfer to the ivnestor. And trust me, many investors wind up with title to the property. I have a friend whose brother lost several properties he owned because he failed to pay the back taxes. This is incredible to her. The properties were worth several hundred thousand dollars apiece and the investor picked them up for less than $10,000 per property. Wow. Now, that is an amazing rate of return, right? Even if the propeties needed a tremendous amount of repair. To find out more, contact the assessor’s office in your area. Thanks for your question. Don’t forget to share this video and follow me on Twitter and Facebook. Until next time. I’m Ilyce Glink.