Can I get a mortgage to buy a property at a tax deed auction?

Not at the auction itself — counties require cash payment, typically within 24 to 72 hours of the winning bid. After you own the property and complete a quiet title action, you can refinance with a conventional lender, but that process takes months. Most tax deed investors use personal cash, a self-directed IRA, or a hard money line of credit established before auction day.

What happens to the people living in a property I buy at a tax deed auction?

You take title subject to whoever is in possession. If the former owner or a tenant is still living there, you cannot simply change the locks — you must file a formal eviction through your state's court process. In states like Georgia and Florida, that can take 30 to 90 days. Budget for holding costs and legal fees before bidding on any occupied property.

Does a tax deed wipe out the existing mortgage?

In most states, yes — a properly conducted tax deed sale extinguishes the prior mortgage because the lender was notified and had the opportunity to pay the taxes and protect its interest. However, if the county failed to properly notify the lender during the foreclosure process, the lender may have grounds to challenge the deed. A quiet title action addresses this risk directly.

How do I find out what properties are coming up for tax deed sale?

Counties are required to publicly advertise upcoming tax deed sales, usually in a local newspaper and on the county's official website. Florida posts all upcoming sales on the Clerk of Courts website by county. For states like Georgia, you'll need to check each individual county tax commissioner's website or call the office directly — there's no centralized state portal.

Is there a minimum amount of capital needed to start tax deed investing?

Practically speaking, $3,000 to $5,000 gives you enough to bid on vacant lots, cover a quiet title action, and hold through the resale process without being overextended. You can find winning bids under $1,000 in rural counties, but attorney fees alone for quiet title often run $1,500 to $3,500. Starting with less than $2,000 total creates real cash flow pressure before you've learned the process.

Tax Deed Investing for Beginners

Tax deed investing means buying real estate at a public auction after the previous owner failed to pay property taxes. Counties need to recover that lost tax revenue, so they seize the property and sell it — sometimes at 10 to 30 cents on the dollar compared to market value. That discount is real, but it comes with real conditions attached. You need to understand those conditions before you bid a single dollar.

How a Property Ends Up at a Tax Deed Auction

When a homeowner stops paying property taxes, the county records a tax lien against the property. In tax deed states — like Georgia, Michigan, and California — the county eventually forecloses on that lien and takes title. The waiting period varies. Georgia requires just one year of delinquency before a tax deed sale can proceed. Michigan can take years, going through several notice and redemption cycles first.

Once the county holds title, it schedules an auction. The opening bid typically covers the back taxes owed, accrued penalties, and the county's administrative costs. In a competitive market like Maricopa County, Arizona, popular parcels can sell for 80 to 90 percent of assessed value. In rural counties, the same process might yield a buildable lot for $800.

Tax Deed States vs. Tax Lien States

Not every state sells tax deeds. Some sell tax lien certificates instead — you're buying the debt, not the property. In a lien state like New Jersey, you earn interest (up to 18%) while the owner has a redemption period to pay you back. In Illinois, that rate can reach 36% on the penalty. If they don't redeem, you eventually foreclose to get the deed.

Tax deed states skip that step. You buy the property outright at auction. Florida is a hybrid: it sells liens first, and if unredeemed, those convert to a tax deed application process. Know which category your target state falls into before you spend a day researching auctions.

What to Research Before You Bid

Title is your biggest risk. A tax deed does not automatically wipe out every encumbrance. Federal IRS liens, for example, survive the tax deed process in many states and require a separate resolution. HOA liens, environmental violations, and code enforcement fines can also survive depending on state law.

Before bidding, pull the property's title history at the county recorder's office. Run a property record search through your county assessor to confirm the legal description, lot size, and zoning. Drive the property in person. A house listed at $40,000 that needs a $70,000 roof and has a $15,000 IRS lien attached isn't a deal — it's a problem.

Also check the redemption period. In Georgia, the owner has one year after the sale to redeem the property by paying you the purchase price plus a 20% penalty. If they redeem on day 364, you collect your 20% and walk away with no property. Plan your capital accordingly.

Warning: Many beginners assume a tax deed clears all title issues. It doesn't. To get insurable title — the kind a title company will cover and a future buyer's lender will accept — you'll almost always need to file a quiet title action after purchase. In Florida, that process typically costs $1,500 to $3,500 in legal fees and takes three to six months. Budget for it before you bid.

How Online Tax Deed Auctions Work

Most counties have moved to online platforms. Florida uses RealTdAuction.com and Bid4Assets. California counties use their own county-run portals or Bid4Assets. Georgia auctions are still largely conducted on the courthouse steps on the first Tuesday of each month, though some counties stream them online.

Online auctions require a deposit — often $200 to $5,000 depending on the county — just to bid. If you win and don't fund the full purchase within the required window (typically 24 to 72 hours), you forfeit that deposit and may be banned from future auctions. Set up your funding before auction day, not after.

Your First Realistic Deal

For a first purchase, target vacant land or properties in counties where you can inspect physically. Vacant lots carry no structural risk, no eviction scenario, and no immediate holding costs beyond taxes. A rural lot in a Florida panhandle county might sell for $500 to $3,000. It won't make you rich, but it'll teach you the closing process, the quiet title process, and how to resell through owner financing — all without the pressure of a house sitting vacant and deteriorating.

Once you've closed one deal cleanly, move to residential properties with more upside. By then you'll know what a title search actually looks like, what to ask a real estate attorney, and what a realistic rehab estimate feels like in your target market.

Building a Repeatable Process

Tax deed investing rewards system builders. Investors who buy consistently in the same two or three counties develop an edge: they know local comps, they have relationships with title attorneys who understand the quiet title process, and they know which neighborhoods produce resalable properties versus which ones sit unsold for years.

Keep a spreadsheet for every property you research — not just the ones you buy. Track the opening bid, final sale price, estimated ARV, and your pass/bid decision. After 20 to 30 auctions, patterns emerge. You'll start seeing which property types consistently go above value (making them unprofitable) and which ones other bidders ignore for reasons that don't actually affect resale.

For state-specific rules on redemption periods, deed types, and auction schedules, the Georgia tax deed auction guide on Tax Sale Ninja is a solid starting point for one of the most beginner-accessible states in the country.