3 Things People Do Not Tell You About Tax Deeds
Written By Tony Martinez
Main Points
If you’ve been around the tax lien and tax deed world for any length of time, you’ve probably heard a few “too good to be true” promises. The internet is full of them and unfortunately, so are some of the seminars and videos out there.
At the U.S. Tax Lien Association, we’ve spent over 32 years working directly with investors at every stage, from brand-new beginners to seasoned pros, and we’ve seen firsthand how misinformation can cost people time, money, and opportunities.
So, let’s set the record straight; here are 3 common false claims people make about tax deed investing and the realities you need to know if you want to succeed.
1. “You’re Guaranteed a Valuable Property.”
This is probably the most common myth and the one that gets new investors into the most trouble. The truth? Many properties on tax deed lists are in poor condition, have structural issues, or are in undesirable locations.
Some are so remote that they have no utilities, no road access, or are literally landlocked. Others might be in flood zones or economically depressed areas with little to no resale or rental value. There’s often a reason the property ended up on the tax sale list, and why no one else has claimed it.
While there are fantastic deals to be found, not every deed is a hidden gem. Thorough research is not optional; it’s the difference between getting a property that produces cash flow and inheriting a property you can’t give away.
Some people see a $2,000 starting bid and assume it must be a steal. But low price doesn’t always mean high value. Many tax deed properties are vacant, abandoned, or severely damaged.
What looks great on paper could require tens of thousands of dollars in renovation just to make it livable. And in some cases, the best financial decision is not to renovate at all but to flip it as-is, or even walk away before you buy.
Remember, your goal isn’t just to “get a property,” it’s to get a property that will actually perform as an investment.
2. “You Can Flip the Property Right Away.”
It’s true that tax deed states don’t have redemption periods like tax lien states, but that doesn’t mean you can walk into a tax sale on Tuesday and sell the property on Wednesday.
In many cases, you’ll need to address lingering legal issues, cure title defects, or resolve competing claims before your ownership is fully recognized. Depending on the state, this might require a quiet title action, which can take several months and may come with legal fees and court costs.
So yes, flipping is possible, and many of our clients do it successfully, but it’s not always fast, and it’s never automatic.
Proper planning and legal follow-through are crucial for a smooth and profitable process. That’s precisely what we teach here at USTLA: how to invest smarter, avoid costly mistakes, and set yourself up for long-term success.
3. “It’s Quick Money.”
Tax deed investing can absolutely deliver substantial returns, but it’s not “fast cash.” Between due diligence, acquisition, potential rehabilitation, and the time it takes to set up a resale or rental, it often requires patience and consistent effort before profits are realized.
The good news? When you know what you’re doing, that time and effort can translate into incredible results. The key is to have realistic expectations and to focus on building a repeatable process, not chasing overnight success.
The Smart Way to Build Wealth With Tax Deed Investing
Tax deed investing is one of the most powerful wealth-building strategies in real estate, but only when approached with the right knowledge and realistic expectations. Ignore the hype, do your homework, and follow a proven process.
At USTLA, our mission is to teach you how to go beyond just earning interest and actually acquire valuable real estate at massive discounts. With our proprietary "Get the Property" strategies, you’ll learn how to avoid the traps that take down beginners and position yourself to thrive in this business for years to come.
If you’re ready to discover our step-by-step system for finding, evaluating, and acquiring properties free and clear for the price of the back taxes and penalties only, start with our Free 3-Module Online Video Crash Course. It’s the fastest way to learn the truth about tax lien and tax deed investing and to start building the skills and confidence to secure deeply discounted properties through our proven strategies.
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