Any indemnity tax other than property tax may be sold on sale. This includes unpaid utilities, sewer, water or garbage bills or any special assessment. Basically any unpaid bill payable and unpaid to the local government (township, municipality, county or taxing district) can be sold as a tax lien. Like unpaid taxes, the borrower is in the first position and can predict the property if the liability is not released within the release period. The recipient-holder also has the power to pay subsequent utility charges (and even subsequent taxes) if the property owner does not pay on time.
Many states give you the opportunity to pay the next duty and collect the highest or default interest on your subs. The exception to this is Florida: Florida counties do not allow you to pay subsequent tariffs and they will sell lien at tax every year. So you don’t get that opportunity there, you have to try to buy lean every year.
Utility lenses can be a good investment for a number of reasons. Initially the amounts ineligible for these lines are usually lower than the tax, so you need less money to buy utility lines than to buy tax lines. And because these lenses are small, institutional investors rarely bid on them, so they are a bit less competitive than larger tax liens. Second, when you own a utility lien, you can pay subsequent taxes as well as subsequent sewage charges if not paid by the owner. I had a few liabilities that I first bought as a small sewer liability and later when the property owner stopped paying taxes, I was able to pay the overhead tax as well as the amount of the sewer. It has added thousands of dollars to my real rights. Since it was a New Jersey tax line I was able to get 18% on all my subsequent tax payments!
Purchasing a utility lane I use to double my tax lean portfolio !!