Over-The-Counter Sales
Over-the-counter is not a system of bidding on a property, rather a means of purchasing a property directly from the local government. These properties become available after the auction. If an auction takes place, any unsold liens or properties go into inventory and become available for sale. It is possible for investors to go to the county official’s office and buy liens or deeds over the counter.
Keep in mind that the county does not want to own these properties. Property taxes represent the largest source of revenue for the county. If the county owns a property, it cannot collect tax on that property (unless it wants to pay the tax itself, which negates the revenue right there). The county needs to sell its surplus properties because they create a financial drain for the property as long as they remain county owned.
Leftovers
You may think that properties that are, in essence, leftovers after the auction might not have much value. Some times that is true. Some times all liens or deeds are sold at the auction, leaving nothing over. You should remember, however, that a certain number of auction purchases will default. Someone may have bid in error on a property and later discovered it was not the property that investor intended on going after; the county may allow the investor to void the purchase. Likewise, an investor may have purchased 20 deeds or liens at an auction but failed to come up with the purchase cash, causing the county to take the purchase back. Often, the county may have 37 properties to sell at an auction but only 3 people come to bid on them, which leads to leftovers.
Over-The-Counter Sales
Over-the-counter is not a system of bidding on a property, rather a means of purchasing a property directly from the local government. These properties become available after the auction. If an auction takes place, any unsold liens or properties go into inventory and become available for sale. It is possible for investors to go to the county official’s office and buy liens or deeds over the counter.
Keep in mind that the county does not want to own these properties. Property taxes represent the largest source of revenue for the county. If the county owns a property, it cannot collect tax on that property (unless it wants to pay the tax itself, which negates the revenue right there). The county needs to sell its surplus properties because they create a financial drain for the property as long as they remain county owned.
Leftovers
You may think that properties that are, in essence, leftovers after the auction might not have much value. Some times that is true. Some times all liens or deeds are sold at the auction, leaving nothing over. You should remember, however, that a certain number of auction purchases will default. Someone may have bid in error on a property and later discovered it was not the property that investor intended on going after; the county may allow the investor to void the purchase. Likewise, an investor may have purchased 20 deeds or liens at an auction but failed to come up with the purchase cash, causing the county to take the purchase back. Often, the county may have 37 properties to sell at an auction but only 3 people come to bid on them, which leads to leftovers.
If you purchase a deed over the counter, that is an immediate transaction. You take immediate possession, so you should check the property out in advance of making an offer. You screen the property and check mapping to make sure it is worth owning and is something you can market and sell (see “Assess a Parcel” and "Mapping”).
As of our most recent research, the following states offer over-the-counter properties. You should check directly with counties in each state.
- Alabama (Administered by the Alabama Dept. of Revenue)
- Arkansas – "Negotiated Sale" (Administered by Commissioner of State Lands)
- Colorado – (Allowed in all counties but not done in all: Denver does not)
- Oregon – (Occasionally done in some counties)
- Pennsylvania – "Repository" Sale
- Texas – "Struck Off" Sale
- West Virginia (Deeds only through the deputy land commissioner for the state)
Several of these states are described on a separate page: “State Specific Information.” This will show you some links and ideas for addressing over-the-counter purchases in these states.
