When you are considering the possibility of buying tax foreclosure property listings, you might want to consider the benefits of purchasing a tax lien certificate instead if you are an investor and not just a buyer in search of a primary residence. Below are some of the benefits you might want to think about.

High Interest Rates

If you purchase a tax lien certificate, that means you are basically paying off the tax debt owed by the original homeowners. In exchange for that payment, the government agrees to pay you interest on what is essentially a loan to them. That interest rate is not the insignificant amount you might get from a savings account either.

Instead, you could be looking at rate as high as 24%. That means if you purchase a tax lien certificate worth $10,000 you'd make an additional $2,400 on your investment yearly until the property is sold. At that time, you're repaid in full plus the interest.

First Purchase Option

Another benefit of taking this approach with tax foreclosure property listings is that in many states the tax lien certificate holder gets first choice at purchasing the property if it needs to be repossessed later on. That could be a great chance for you to secure a property you're interested in. You are not obligated to purchase the home. If you refuse, the property just goes to auction or is sold through some other means.

Convenience

While finding tax foreclosure property listings is pretty easy, buying the outstanding lien certificates is sometimes easier because you don't have to attend an auction. You can purchase them by mail without even having to be present for anything. Now you still need to check those tax foreclosure property listings but at least you have more investment options than you might have thought.