For prospective real estate investors who dream of buying homes below market value, auctions of homes with delinquent tax bills hold tantalizing promise. Snapping up a property in default can cost as little as the owed tax, which is often well below the home's market value. According to the Los Angeles County Tax Collector's Office, homes located in the county that are in tax default for five years are auctioned on the steps of the Los Angeles Superior Courthouse to satisfy the debt. Buying property at the county's tax auction requires advance planning.
Instructions
Buying Properties at the Los Angeles County Tax Auction
1. Visit the Los County Treasurer and Tax Collector's website to fill out a bidder registration form. Click on the first link in the Resources section. Scroll down to "Public Auction," which is the third section on the right. Choose the second option, "Bidder Registration Form." Click on the link, and complete registration as soon as the form is available.
2. Choose the home or homes you're interested by looking through the county's list of available properties. To get a list of addresses and their delinquent tax amounts, click on the first link in Resources. Scroll down to "Public Auction," or the third section on the right. Choose the fourth option, "Purchase the Auction Book." You can also look at the auction book for free at most Los Angeles County public libraries. Classified sections in your local newspaper will run lists of homes scheduled for sale beginning three weeks before the auction.
3. Obtain a cashier's check or money order in the amount you're willing to pay once you've identified a property and determined its minimum bid, which is the past-due tax total. California law requires the winning bidder to pay the entire sale price on the spot, so you can't finance any portion of your purchase. The home will go to the highest bidder. You can get your cashier's check or money order in the amount of the owed tax, or you can ask for a higher amount to challenge others who might try to outbid you.
4. Attend the auction on the day and at the time the county tax collector has scheduled the sale. The sale is on the courthouse steps. The county requires buyers to bid in person at the sale.
5. Voice your interest when the auctioneer names the home you want to buy and asks for bids. If someone else bids after you, bid again until you reach the maximum listed on your cashier's check or money order. You must say your bid out loud; sealed bids aren't permitted.
6. Give your cashier's check or money order to the tax collector's representative immediately if you win the bid for a home.
7. Take possession of your new property after the Los Angeles County recorder has registered the tax deed to purchaser. The recording process could take two to three days. Call the recorder's office for updates.
