LienSimple Corrections
Tax-sale claims that are wrong — and what the statute actually says
A lot of tax-lien education repeats state rules the statutes contradict. This page documents the errors we see most often, each paired with the governing law and a link to the sourced state guide. If you find one of ours wrong, tell us — corrections are the point.
Educational only, not legal or investment advice. Verify against the primary source before acting.
“Texas is a tax-lien-certificate state where you earn up to 25% interest.”
Texas does not sell lien certificates. It runs a redeemable-deed sale: the buyer receives a deed at the sale, and the former owner may redeem by paying a flat premium — not accruing interest. The 25% is a one-time premium within the redemption window (25% within 180 days for most property; 25% in year one and 50% in year two for homestead, agricultural and mineral property), not an annual yield.
“In Florida you buy the property at the tax sale.”
Florida’s annual sale sells a tax lien certificate, not the property. The certificate earns bid-down interest (18% ceiling, 5% minimum guarantee on most redemptions). Only after a statutory holding period can the certificate holder force a separate tax-deed application and public auction — a distinct, later step many summaries collapse into the certificate sale.
“Tax liens pay a guaranteed 18% (or 36%) return.”
A statutory ceiling is not a realized return. In premium-bid and bid-down states the rate is competed downward at auction, and in flat-penalty states the penalty is only earned if the owner redeems — the timing sets the annualized yield. There is no single reliable industry figure for average returns, and a redemption is a return of capital, not a coupon that keeps paying.
“The redemption rule is the same for every property in a state.”
Redemption terms frequently differ by property classification within the same state. Texas is the clearest case: 180 days for most property but a two-year window (with a 25%/50% premium schedule) for homestead, agricultural and mineral property. Assuming one rule across all parcels is a common and costly error.
“New York is a tax-lien state.”
Most New York counties sell tax deeds, not liens. Where liens exist the mechanics vary by venue — Nassau County sells liens to the public, while New York City’s lien sale conveys only to an institutional trust, not retail bidders. A single “lien state” label misstates how the sale actually works for an individual investor.
“A state summary tells you how a given county’s sale runs.”
County practice does not always match the generalized state rule. Auction format, platform, registration deadlines and even applicable rates can vary county-to-county (Maryland sets interest per county, 6–18%). We verify at the county level in the auction directory and label each sale confirmed, statutory or not-yet-announced.
“The advertised rate is what your capital earns per year.”
In flat-penalty states (Texas, Georgia, Delaware) the penalty is a one-time figure, not an annual rate — a 20% penalty redeemed in one month is a very different annualized number than the same penalty redeemed near the deadline. Annualizing a flat penalty as if it were simple interest overstates or understates the real return depending entirely on redemption timing.
Found an error — ours or someone else's?
We hold our own data to this standard. Every state guide carries its primary sources and a last-verified date; every auction entry links to its official county or state source. If a figure here is out of date or wrong, we want to fix it.