Alabama vs Colorado Tax Lien Investing (2026)
Statutes verified Jul 2, 2026
For a retail investor, Alabama edges it overall (5.6/10 vs 5.1/10). The biggest single difference is effective yield: Alabama scores 5, Colorado scores 4. Neither is "best" for everyone — match the state to your goal below.
- System:
- lien
- Max rate:
- 12% bid-down
- Redemption:
- 3yr min 10yr
- System:
- lien
- Max rate:
- Fed discount rate +9 pts, set each Sept 1 (14% for 2025); premium bids earn 0%
- Redemption:
- 3yr from sale before treasurer's deed application
Head-to-head: 9 dimensions
12% ceiling bid down in 1% steps on GovEase; hot liens go to low single digits
14% (2025) rate but premium bids earn nothing and are not refunded
Simple interest at bid rate only; no flat penalty on early redemption
Simple interest only; rate reset yearly at discount rate +9 pts (39-12-103)
Owner may redeem anytime; foreclosure only after 3yrs, cert expires at 10yrs
3yrs from sale before treasurer's deed application
Most counties auction liens online via GovEase; OTC pickup at county offices
Most counties run online sales (RealAuction/GovEase); county-level auctions
Online GovEase sales draw national bidders; metro liens bid near 0%
Online premium bidding is aggressive; premiums erode net yield
Liens sell at back taxes; many certificates a few hundred dollars
Certificates sell at taxes+fees; small liens plentiful in rural counties
Judicial foreclosure + quiet title; 2018-regime redemption litigation traps
HB24-1056 deed path now ends in public auction; holder may get cash, not land
Lien-auction regime only since 2018 (40-10-180+), amended 2022; counties converting
Post-Tyler HB24-1056 (eff. 7/2024) rewrote the treasurer's deed process
Unsold liens sold over the counter at revenue commissioner offices (e.g. Mobile)
County-held certificates assignable OTC from treasurers year-round
Choose Alabama if…
it doesn't clearly out-score Colorado on any single dimension — see the full Alabama guide.
Choose Colorado if…
it doesn't clearly out-score Alabama on any single dimension — see the full Colorado guide.