How to Earn a 14% Return with Nebraska Tax Liens

Sale Details

Nebraska Tax Lien – Yearly in March

Redemption Period

3 Years

Interest Rate / Penalty

14%

Bid Procedure

By Assignment via First Come First Serve Basis With Legal Requirements by Investor

Online Auction

Only Douglas County

Over the Counter

Yes

Number of Counties: 93

Useful Links

Douglas County Online Auction Site
Nebraska Department of Revenue

If you’re looking for an investment with solid returns and minimal competition, Nebraska tax liens offer a compelling opportunity. In this guide, we’ll explore the details of Nebraska’s tax lien system and how you can earn a 14% return while helping the state collect unpaid property taxes.

Investing in Nebraska tax sales is like finding a hidden opportunity that many might overlook. It’s a way to earn good returns while helping the state collect unpaid property taxes. Let’s get familiar with how tax sales work in Nebraska, why they’re a smart choice, and what makes this state stand out.

How Tax Sales Work in Nebraska

In Nebraska, the state doesn’t just let that debt sit when property owners fall behind on their taxes. Instead, they issue Tax Lien Certificates. As an investor, you step in and pay those taxes for the property owner, and in return, you get to earn interest on the amount you’ve covered.

When It Happens:

○ Mark your calendar for March each year. That’s when Nebraska holds its tax sales. This regular schedule gives you plenty of time to do your homework on potential investments.

How Bidding Works:

○ Nebraska’s auction isn’t a fierce bidding war. It uses a “Rotational” Bidding System where each bidder takes turns. This makes the process fair and gives everyone a shot, even if you’re new to the game.

Interest Rate: 

○ Nebraska offers a solid 14% interest rate on tax liens. That’s pretty high compared to what you’d get from most savings accounts or CDs.

Redemption:

○ After you purchase a lien, the property owner has 3 years to pay back what they owe, plus interest. If they pay it off, you get your money back with some interest. But If not, you could end up owning the property.

Online Auction:

○ If you prefer bidding from the comfort of your home, you’ll want to check out Douglas County, the only county in Nebraska that offers online auctions. The rest require you to be there in person.

Over-the-Counter (OTC) Liens:

○ If you miss out during the auction, don’t worry. Nebraska allows you to buy tax liens over the counter afterward, meaning you can still snag a deal without competing at an auction.

Everything about the tax sale process is laid out in Nebraska Statute 77-1801. This ensures the process is transparent and follows the rules.

Why Nebraska is Great for Tax Lien Investors

Nebraska’s tax lien system is designed with investors in mind, offering :

1. High Interest Rates:
   • With a 14% interest rate, Nebraska tax liens offer a return that’s hard to beat. Plus, the rotational bidding system means you won’t be stressed out trying to outbid everyone else.
     
2. Rotational Bidding:
   • The rotational bidding system ensures that everyone gets a fair shot, regardless of how deep their pockets are. This setup is especially great for beginners who might feel overwhelmed by the idea of traditional auctions.
     
3. Annual Tax Sales:
   • Since Nebraska holds tax sales annually and offers OTC sales, you can plan your investments and expect a steady stream of returns. The three-year redemption period gives you a clear timeline for when you can expect your money back, with interest.

Interesting Tidbits About Nebraska

Nebraska is home to around 1.9 million people. Omaha is the biggest city, and Lincoln serves as the capital. Property taxes have been a part of Nebraska’s history since the 1800s. Over time, the system has evolved to make sure taxes are collected fairly. Nebraska is one of the few states that uses a rotational bidding system for tax sales, making it stand out in tax lien investing.

What Makes Nebraska Unique for Investments

1. Nebraska isn’t just about tax liens. It’s rich in history and natural beauty, with sites like Chimney Rock and the Omaha Zoo drawing visitors from all over.
   
2. The state has a well-maintained network of roads, railways, and airports, making it easy to get around whether you’re a local or just visiting.
   
3. Nebraska’s economy is diverse, with key industries in agriculture, manufacturing, and technology. The state is also making strides in renewable energy, particularly wind power.
   
4. Nebraskans take pride in their local communities, with plenty of outdoor activities, festivals, and events that bring people together year-round.

How the Nebraska Tax Lien Auction Works

Here’s a simple rundown:

1. Notice of Sale:
   • In February, the County Treasurer publishes a list of properties with unpaid taxes. This list goes online and in the local papers.
     
2. The Auction:
   • The auction takes place on the first Monday in March. Thanks to the rotational bidding system, you don’t have to worry about getting outbid at every turn.
     
3. After the Auction:
   • If you win a lien, you receive a Certificate of Purchase. The property owner then has three years to pay back the taxes plus interest. If they don’t, you might be able to take ownership of the property.

Pro Tips for Investing in Nebraska Tax Liens

• Know Your Counties: Each county might have its own little quirks, especially since only Douglas County offers online sales.

• Don’t Miss OTC Opportunities: If you’re looking for a less competitive option, buying OTC liens can be a great way to invest without the rush of an auction.

• Understand the Redemption Period: Knowing that you have a three-year wait before potentially owning the property is key to planning your investment.

Nebraska Tax Lien Investing FAQs

Q: What happens if the property owner doesn’t pay the taxes?
A: If the owner doesn’t pay within the three-year period, you can apply to take ownership of the property.

Q: Can I invest in Nebraska tax liens if I live out of state?
A: Yes, Nebraska’s tax lien sales are open to both residents and non-residents.

Q: Is investing in Nebraska tax liens risky?
A: Like any investment, there are risks. However, Nebraska’s high interest rate and clear process make it a relatively secure option.

Ready to Get Started?

So, if you’re looking for an investment that offers solid returns without too much hassle, Nebraska tax liens might be just what you’re looking for. Explore more, book a call with us now, or dive into our FREE resources to get started today.