One of the schools of understanding human behavior and performance is Neuro Linguistic Programming or NLP.

Relax, this a blog about tax foreclosures so we’re not going off the chain to delve into a human behavior science.  But, there is a key principal for attaining results in NLP that is very useful to us when investing in tax foreclosure properties.

The very first principal when using NLP methods is:  “Begin with the end in mind.”

What is it that you want to accomplish when investing in tax foreclosures?

There are two deliberate consequences and one potential final consequence.  They are:

1.    Investing for interest income.  The two main tax foreclosure investments are the tax lien certificate and the tax deed.  As noted on this blog, they produce above average rates of income, are secured by real estate and sold commission free by state, county and local governments.  Many of the largest institutional and wealthy investors are here for the above average rates of return on their principal.

2.    A means for investing in real estate with little money down.  This is the riskier of the two propositions and there is a lot of hype about this real estate acquisition vehicle.  However, the reality that one can acquire real estate for a low investment makes it a goal for serious real estate investors.

The final, or fall back, consequence is that the income investor may end up owning the property that secures the tax lien certificate or tax deed.  How good or bad the situation might be depends on the property and its actual condition.

The point is; when investing in tax foreclosures, your due diligence process must include the possibility that you’re going to end up with the property.

Begin with the end in mind and back plan your investing strategies.  That way, whatever your goal is, there’s no surprise.