The “resource group” is comprised of individual investors that have been investing in income producing real estate in Texas for many years. We have years of experience in all phases of real estate including tax sales since the early 1990’s.
Be sure you get your information about Texas tax sales straight from 'the horse's mouth" and not from out-of-state gurus who do not know about Texas sales first hand!
<-- Arnie did!
Arnie Abramson, founder
Texas Tax Sales Resource Group
Texas tax sales resource group llc
The founder, Arnie Abramson, began buying tax sale properties in 1992. For many years afterwards he was a buyer, seller, landlord, and teacher/speaker on all phases of real estate investing primarily in the Dallas-Fort Worth Metroplex and surrounding areas.
This is the story of how the Texas Tax Sales Resource Group came about:
We began this quest when the economy started to falter when what became known as the “Great Recession” neared. Our thoughts were that Texas tax sales were going to become a very good source and opportunity for investors. Many investors were aware of them but very few really knew how they worked and the nuances and intricacies involved.
Our initial effort was to teach these things to investors. While we felt that we were teaching more things in detail than available elsewhere, there was still something missing. That was when we decided to actually mentor investors-take them by the hand and actually do the work with them. While some did make some great purchases, the majority of students quickly became frustrated when, after a lot of work prior to the auctions, they found that their targeted properties were either withdrawn before the sale or they were outbid.
That is when we decided that we would do all the work and charge a fee if our investors were successful. WOW! What a game changer that became. More investors sought us out as they heard about this program. We saw that the demand for good tax sale purchases were quickly going to exceed the supply of properties that we were purchasing every month.
At that point we decided that we had better expand our marketplace of where we were buying properties. To do that we had some logistical challenges that we needed to meet. Things like how to be at different auctions at the same time and how to get funds to the different auction sites when we were successful. Some of our former students helped us overcome these situations by volunteering to represent us in other locations. This eventually led to our LEARN AND EARN program where we train investors to assist us and they are compensated if we are successful in the areas in which they participate.
Some investors got together and formed LLCs where they pooled their funds to buy properties and some purchased tax sales properties. That turned out to be a great way to get to know how the tax sales worked with a smaller investment until they were comfortable enough to buy them individually. It also was helpful to those with limited funds to build a diversified portfolio of partially owned properties. These are still being done today with investors in some of the real estate investment clubs forming their own entities. (firstname.lastname@example.org)
The turnkey program, available to our Priority Members (PM), was becoming very popular but we found that the more counties that we pursued, the more time consuming our work became to find the potential properties, present the information and worksheets to evaluate the potential purchases, perform the lien searches, and then wait for bidding instructions from our PMs. We started charging a fee to become a PM so that we could work with those that had a financial commitment rather than just wanting to get the benefit of our due diligence.
The next hurdle to be overcome was that we had to wait until close to the auction dates to complete all the research, evaluations, and viewing of the properties since so many were withdrawn from the sale as the first Tuesday grew closer. This made it difficult for us to provide the information needed, send it to the PMs, wait for them to determine their bids and get back to us – all in time for us to deploy our resources in the counties where the bidding indications led us. Additionally, it severely limited the number of counties and properties that we had time to effectively provide the data to our PMs.
Not only was this limiting the number of properties that we could provide from which the PMs could choose, but remember that we are cautioned not to inspect the properties before bidding on them as it could be deemed trespassing. That meant that there were several unknowns about the properties that we had to make educated guesses on that would affect our bid prices. If we allowed too much for rehab, for example, our bids would be below others that did not allow that much. If we did not allow enough, the total out of pocket costs would be higher which would reduce the cash flow on the property after rehab.
After several sleepless nights, discussions, brainstorming sessions, and support from our spouses, we came up with a solution – THE TEXAS 2-STEP FOR TAX SALES. Very simply, we would buy the houses first, rehab where necessary, rent up and then offer the cash-flowing properties to our PMs (Priority Members).
This would allow us to cover more counties, and allow our PMs to only consider purchases of properties that were already secured and the data on them known. In order to know how many properties to try and purchase, a good faith deposit was required. If a PM decided not to purchase any of the properties offered, the deposit was to be refunded. The deposit was to be roughly 75% of what the PM was prepared to invest.
As the demand continued to grow, we established a division to concentrate on the re-sales and the strike-offs in order to secure more potential properties. Additionally, we started to put more emphasis on rehab properties which had less competition. We had continued to train more investors in other areas for the LEARN AND EARN program and started buying in counties in which we had not previously purchased.
The next adjustment was our securing a funding partner for the purchases that eliminated our requiring a good faith deposit from our PMs.
So, to summarize, we now have a completely TURN-KEY program.
We purchase the properties that meet our estimated cash flow criteria for our PMs.
We get inspections done on the properties purchased.
We offer the properties to those PMs, if any, that consider doing their own rehabs.
We rehab and get “rent ready” the properties that are available.
We rent-up the properties and then publish the list to our PMs.
The PMs review the available properties, including but not limited to the following:
- Purchase Price
- Rented Amount
- Taxes and insurance Costs
- Management Fees (many are no charge for PMs)
- Net Operating Income if Purchased
The next chapter in our evolution, came as a result of the Texas real estate market heating up and the competition at all the auctions in the major city areas causing purchase prices to soar upwards that adversely affects cash flow.
This caused us to concentrate on areas where there was less competition, while maintaining our participation in the major market areas. Specifically, we created two new programs.
One, called the Quick Step, allows us to concentrate on the lower priced properties and properties in less populated areas by working with our Priority Members and helping them find and bid on them.
The second one, Lien to Deed Program (LTD), allows us to purchase tax liens in tax lien states, convert to deeds, foreclose, secure marketable title and sell at wholesale prices for significantly higher prices than our cost.