The Most Dwanderful Real Estate Podcast Ever!

Unlocking Tax Lien Fortunes with Legend Ted Thomas

• Dwan Bent-Twyford/Ted Thomas • Season 5 • Episode 386

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Imagine earning an 18% return on your investment just by helping your local government. Our latest episode features the seasoned expert Ted Thomas, who has over three decades of experience in the niche but highly lucrative world of tax liens and tax-defaulted properties. Hosted by Dwan Bent-Twyford, we reminisce about our shared stages with industry legends like Donald Trump and Tony Robbins, while Ted opens up about his transition from the foreclosure business to mastering the art of tax lien investing. This episode promises to equip you with essential knowledge, whether you're a real estate novice or a seasoned investor.

Have you ever wondered how to scoop up discounted properties at a fraction of their market value? Ted Thomas breaks down the fascinating mechanics of tax lien certificates and tax-defaulted property auctions. We explore the step-by-step process, from purchasing tax lien certificates to securing properties at auction, all while emphasizing the significant returns and minimal risks involved. With Ted's expert guidance, you'll learn how to navigate the varied processes across different states and avoid the common pitfalls that many new investors face.

Beyond the world of real estate, get to know Ted on a personal level. From his love for 1940s big band music to his cherished moments as a pilot witnessing breathtaking sunrises and sunsets over the Pacific, Ted shares his passions and life experiences. He even hints at his philanthropic goals and offers a special promo code for listeners interested in his virtual classes. Tune in for a comprehensive and engaging episode that not only covers the lucrative realm of tax liens but also lets you in on the personal joys and future aspirations of our esteemed guest.

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Dwan Bent-Twyford:

Hey everybody, welcome to the most Dwonderful real estate podcast ever. I'm your host, wanda Benton-Twyford. I am America's most sought-after real estate investor and I'm telling you I have such a good treat for you all today. This is my friend, ted Thomas, and Ted and I have known each other at least 30 years. So long We've spoken everywhere, all over the country, giant stages, and I'm so excited to have him on as my guest today. So, before we start with Ted, the motto at D'Wonderful is people before profits, so that's something that resonates with you. You're at the right place. I'm a girl, this is your guy, so let's get into it. So, ted, seriously, how the hell are you?

Ted Thomas:

I am great. I never felt better.

Dwan Bent-Twyford:

So do you still say yes and yes?

Ted Thomas:

Yes and yes.

Dwan Bent-Twyford:

You know, I used to teach trial closes, so I'd say to people yes or yes and they would just say yes, that was great I remember you and I gosh darn, we spoke at the Learning Annexes in New York and Donald Trump was there, and Tony Robbins and Kiyosaki and Suzy Orman and you and me and we had so much fun at all those big events.

Ted Thomas:

Boy, those events were huge, Sometimes 40,000 people. I remember being in Los Angeles and you couldn't leave the room because there was so many people in the hallway. You know there's 40,000 people there. It was unbelievable. They were fun.

Dwan Bent-Twyford:

I kind of hated to see those go away. I thought because they were just. You know, first of all it's fun to speak and teach and train and, you know, get to share our programs and our knowledge with people. But it was just always good to be able to see all the other speakers too.

Ted Thomas:

Right, absolutely. I haven't seen you sgo have dinner.

Dwan Bent-Twyford:

You look amazing, I'm just saying it. You look freaking amazing.

Ted Thomas:

Oh, that was the right thing to say. Now, you made my ego so big. I'm as big as the empire state building, okay.

Dwan Bent-Twyford:

No, you look great, you look great. And you have been teaching the tax lianes for I mean forever and ever. I actually learned what I know about them from you and sitting in on all your classes and everything.

Ted Thomas:

Well, thank you. You know, I started out in the foreclosure business, so my first jgrade was as a pilot and then, when I finished flying, I got involved in foreclosure real estate, which I liked and that worked well. But then everybody got in the business and I said well, if everybody's in the business, everybody's pushing the price up, up, up. You could buy foreclosures for 30 or 50 cents on the dollar. But oh, my goodness, what happened Next thing? You know, people paid 70 and 80 cents on the dollar. I said well, you pay 80%, how are you going to make any money? And so I started learning about tax liens a little over 30 years ago and I've been at it ever since and it's been a great business. It still is a great business. It still is, and nationwide it's in every single county in the United.

Ted Thomas:

States yeah.

Dwan Bent-Twyford:

So let's tell everyone right off the bat are you online? Do you have all social media? Do you have Instagram?

Ted Thomas:

Oh yeah, we have all the social media channels. So what is your social media? Well, so what?

Dwan Bent-Twyford:

What is your social media?

Ted Thomas:

Well, most people just want to go to tedthomas. com. That's the easiest place to start Tedthomas. com. Right. That's where most people start.

Dwan Bent-Twyford:

Okay, and then I know they can find you on YouTube, and so they'll just go to tedthomas. com and they'll find you in all the places.

Ted Thomas:

Right, yeah, and definitely YouTube. I have about 2,000 visitors on YouTube every day, about 5,000 or 6,000 subscribers to YouTube, and I just started. I'm not a tech guy, I'm a hands-on person, so I just started the YouTube channel three years ago, but it's up to 55,000 people already.

Dwan Bent-Twyford:

I know, hey, listen, that's amazing. But you know honestly, you just like. You have so much knowledge with what you do so you teach people. So let's talk about tax liens. So a lot of the people on my Dwonderful real estate podcasts are people that are newer in the business. So you know, if someone's like brand brand new, I'm like just wholesale a house is a good way to get your feet wet, but tax liens are something I think that people can do is like brand brand new.

Dwan Bent-Twyford:

I'm like just wholesale a house is a good way to get your feet wet, but tax lanes are something I think that people can do straight out of the gate, even as new people, but a lot of people don't talk about it. In fact, I've had my podcast for five years. I think I've only interviewed like one or two people that teach people how to do tax lanes, because you're like, you know, you're like the grandfather.

Ted Thomas:

Yeah, right, yeah, oh, the godfather is right, you're the godfather, you are the godfather of tax liens. They're probably my students.

Dwan Bent-Twyford:

They probably are your students and when I, when I found out that you were available, I was like, oh my God, ted's on my podcast. I have to say I feel really honored because I've just seen you on the giant stages and known you for so long and, yeah, we're all like kind of new together. Back, back, back, back back. So it's a real honor for me to have you on today.

Ted Thomas:

Well, we should say one thing before we talk about tax advocates. So we worked in New York City and big forums. I mean there were so many people there, 20 or 30,000 people and I'll never forget when we come up from down to these big forms. There were big rooms and I'd come up a big elevator and I'd come up the elevator and there was a picture of you that was at least 20 foot tall, at least 20 foot. There you were glamorous, you waving at all of us and welcoming us. I'll never forget that picture. So when we made the appointment for this broadcast, I said Linda, you're not going to believe this. This gal was so glamorous. She had a picture that was so biad. I've never seen such a big picture in my life. So here we are doing it again. It was, you're just as glamorous. Now I don't know how you did it, but you really did it.

Dwan Bent-Twyford:

Thank you, I will accept that compliment. Yeah, I remember the one there in New York and they were like they had me speak on the big stage with, uh they go, we're going to put up some pictures of you. And I remember myself I didn't know. When I went in I was like, oh my God, that's the biggest picture I've ever seen of myself anywhere. So then, when we're done, I was like, could I have that picture? Like how are you?

Ted Thomas:

going to get it.

Dwan Bent-Twyford:

I don't know, but it's like 20 feet tall. It was the biggest picture I've ever seen.

Ted Thomas:

That's a trademark forever. I mean, it was unbelievable, really unbelievable.

Dwan Bent-Twyford:

Those were some really good times and you know, you and I spoke on the stages with Donald Trump and Tony Robbins, and Kiyosaki, of course us, and Susie Orman, and I remember Russell Sieminer was that one Any big?

Ted Thomas:

name that was on television was on that program, everybody, and we were really the people that made the money for the event. But the big names were what brought people here. Trump brought thousands and thousands of people. Susie Orman, all those people brought wonderful, wonderful crowds. I mean I've never been in a crowd like we were in Los Angeles, where there was 40,000 people. I mean I've never been around anything like that. That was really fantastic.

Dwan Bent-Twyford:

I had never seen that many people either. When I got up on that really big stage it was like 10,000 people and I thought, oh Lord, have mercy, I did it because you know I'm not nervous. And I got up there and when I was standing there I was like, oh all right, I can do it. I can do it. I know what I'm talking about, but it was a lot of people.

Ted Thomas:

Yeah, it sure was. So let me tell you about taxidermists. So tell us about taxidermists.

Dwan Bent-Twyford:

So someone that's like, let's just say, someone is like really super brand spanking new, they don't know anything about taxidermy.

Ted Thomas:

Okay, okay, how does that?

Dwan Bent-Twyford:

work for a brand new person.

Ted Thomas:

Foundation right from the foundation. All right, so every property in the United States is taxable, all right, half of the states sell tax defaulted. All of them sell tax defaulted, but half of them will sell what's called a tax lien certificate. Now, this is a certificate that's produced by a local government, meaning a county. So there's over 3,000 plus counties and all the counties that sell these tax certificates. Now, a tax certificate is nothing more than a piece of paper, and that's a piece of paper like I'm holding up right now. It's just a piece of paper like that.

Ted Thomas:

Yeah, okay, so if someone didn't pay their tax, the county would say now Dwan, you didn't pay your tax. So what we're going to do is we're going to slap your hand and we want you to pay your tax return, but meanwhile we're going to let someone else buy this certificate, which is a tax on your house, so they could pay the tax on your property. So thousands of these certificates are available and they paid outrageous interest rates. So it wouldn't matter whether you were in Florida, where they pay all the way up to 18 percent, or whether you were in Iowa, where they pay 24 percent, or whether you're in Iowa where they pay 24%, or whether you're in Phoenix, arizona, where they paid 16%. So there's all these different amounts they pay. It's all up to the state to do that.

Ted Thomas:

Now anybody can go to a tax lien certificate auction. Now you can do it online. You just raise your hand like that and say you want to buy it and then you're just going to give your money to the government. You can't give the money to government. You can't give the money to me. You can't give the money to you.

Ted Thomas:

This is super safe. This is the safest investment in America today because it goes directly to the county Yep and the county will hold that money. Now you're not going to lose your house because you didn't pay the tax. So 97% of all these certificates will pay off. In other words, the people will come in and when they come in and pay their tax, they get a penalty. So now they get their hands slapped. Yeah, and the penalty is just like master charge and visa Same thing. It's a penalty. You didn't pay on time, so now you're going to pay. So if they paid in Florida, it might go all the way up to 18%. If they paid it in another state, it might be a different rate. The point is these are safe certificates. So a place like Florida, they'll have 1 million certificates available in the month of May 1 million a year A million, a million.

Ted Thomas:

Miami Florida will have 60 or 70. Here I'll show you so. They advertise these in the newspaper. Anybody can find it. So here's, this is the Tampa newspaper. Yeah, okay, but there's no pictures, it's just lists of tax lien certificates. Wow, 40,000 just in that list, so you can pick out every single county. So about 1,500 to 1,700 counties sell tax lien certificates. Yeah, so anybody can buy them, anybody tax lien certificates.

Dwan Bent-Twyford:

So anybody could anybody. And so the thing I like about tax certificates, let's just say someone's taxes are, I don't know, $5,000. Right, I commit, I pay the $5,000 to the city. I have a tax certificate and I'm getting this 24% interest and you can hold those for what? Two years before the people have to. So at the end of the two years you've made 24% interest for the last two years and then the homeowner or the bank or someone is going to pay for that certificate, because that certificate now moves into first position in front of the mortgage. So the bank isn't going to lose a whole, entire mortgage over a tax certificate right.

Ted Thomas:

so you get two possible pay. One could be the homeowner would pay for it or the bank would pay for it. Yeah, all right. Now what if they don't pay you at all? So if you didn't get paid at all, then you're going to get the property without a mortgage. That's right. The mortgage is wiped out.

Ted Thomas:

So some people buy and pray that nobody pays, because they're going to get the property. You're going to get the right, so it's a great investment for it. And so you. You have to know that 95, 97% of these certificates are going to pay you, so you need to do it as a long-term investment. So where is it perfect for? How about a pension plan, an IRA plan or something like that? If you have one of those, that's a perfect place for it.

Ted Thomas:

Then there's the other side of the business, which is called tax-defaulted property. So you remember when I started, I said every property, and there's 100 million of them in the United States and we track them all with a computer right here. We can show you how to sit. I can sit where you're sitting right now and you can tap into 100 million properties 100 million. Now. Those properties are going to get sold with a starting bid of the back taxes. Now, let's say it was a $100,000 property and the starting bid is back taxes probably only about $5,000. So there's a lot of margin there. But the smart people like you and me, the people we teach, they're going to go to that auction, they're going to bid it up so it won't get sold for $5,000, but you still can buy properties for $0.25, $0.30 on the dollar and you made a great deal. So where are you going to get properties for $0.25 or $0.30 on the dollar? No place At the tax defaulted auctions, yeah, and there's 5,000 tax defaulted auctions every year.

Dwan Bent-Twyford:

Wow, that is so crazy. I just way back when I used to work with Sharon. We would, and when we were working in Fort Lauderdale we would go to the Broward County and we'd buy a few tax certificates here and there. But they oh hey, look, bill Twyford, look who I am talking to.

Bill Twyford:

Oh, my God, how you doing, ted. Hey, I'm great, I'm great. Hold on Let me get my.

Dwan Bent-Twyford:

You look so great, let me get my.

Ted Thomas:

Oh, that's the right thing to say Keep it up, keep it it's.

Bill Twyford:

There you go. It's good seeing you, man. Thank you, good to see you. You look great.

Ted Thomas:

So you guys must be living in a refrigerator eating vitamin C. You don't eat food. You both look great.

Bill Twyford:

Oh, thanks man.

Ted Thomas:

I'm 66 now.

Bill Twyford:

She's been probably 20 years since we've been together, that we've seen you.

Ted Thomas:

We were just talking about the big pictures at the Learning Annex of Dwan.

Dwan Bent-Twyford:

Oh, there you go. He came up the elevator. He wanted a picture of me.

Ted Thomas:

Yeah, I've never seen a big picture of any other woman like that. It was unbelievable, oh.

Bill Twyford:

I know.

Ted Thomas:

That's so cool. I bet all those guys were tapping on your shoulder and saying leave my number in case you decide to leave town. Right, that's right? Yeah, I know that.

Bill Twyford:

Well, it's so good to see you man. I just dropped her off a little bit of food and I, even when I was down eating, I thought, damn, I want to go see Ted while he was on the call with her and I just got busy. But I'm glad I got to see you, thank you. You look great man. You look great. Thank you, we'll catch you later.

Ted Thomas:

Ted, see you All right, so long there.

Dwan Bent-Twyford:

Can't believe that pizza's sitting right here. Okay, so I'll get rid of my background. This is Doesn't he look great?

Ted Thomas:

Yeah, absolutely yeah. You guys are eating right, you're exercising, you're doing everything Good for you.

Dwan Bent-Twyford:

We're doing all the things. So yeah, I know he was to that one learning and that picture. I was like, oh my god, I almost felt a little bit embarrassed. That picture was so big and everybody's like you're on the wall. I'm like I know, I didn't know they would do, but I wish I would have figured out a way to get that picture and ship it to my house because I would make it one of my walls yes, oh god, it was funny.

Dwan Bent-Twyford:

So, um, so with the taxes. So people go on the county sites or like what you have there, and then they buy the certificate. So let's go back to talking about that. They buy the certificate.

Ted Thomas:

Okay. So if you bought a tax lien certificate, it's just a piece of paper like this, that's all it is. This is a certificate that I just put a plastic on so it wouldn't wear out. So you get a certificate, you take it home. You don't have any work to do After you buy a tax certificate. It's a passive investment. So there's no work. So you buy the certificate, take it home, put it on your desk, then you just wait for the people to pay their tax. When they pay it, you're going to get all your money back. I said all your money back and the high interest rate. All right.

Ted Thomas:

Now the other side of it is if you go to any state that's selling tax defaulted property those properties you actually end up with a property. You get a deed, like you guys do with regular real estate. Oh, ok, you get a deed to that property. Now you own the property. So that means you know you have to secure it, you want to take care of it, you're going to have to pay utilities, you're going to pay taxes, you're going to have to fix it up, whatever you have to do, and so we teach people how to do both of those business. They're both very lucrative business, but the one that people want for making money is tax-defaulted property. If they've got pension plans or IRA plans, things like that, they probably want to do tax lien. Or if they're old people like me with lots of gray hair, well then what they have to do is they have to say guess what? We are going to buy some tax liens, be very conservative with their money. So it works for both parties that want to do it.

Ted Thomas:

It's not complicated, but generally real estate people are so busy doing all the stuff they're doing they haven't learned about it. So it's become a specialty, and I've just done the same thing for the past 30 years. We teach classes, we take people to events, we take them on buying tours, we give little introduction things, virtual classes, everything that you can imagine. I don't have to pitch it because I just tell you at the end. Anybody that wants to come to a six hour class I do on every other Saturday I charge them 47 bucks. Everything you ever wanted to know about tax certificates is in that 47. It's six hours. It starts at 11 in the morning, doesn't end till five o'clock.

Dwan Bent-Twyford:

Yeah, I'm going to get on one of those here in the next couple of weeks. So let's go back to the tax defaults. So these are properties where someone bought the property tax and whoever the bank, bank or for whatever reason nobody stepped in to pay that tax certificate back with the interest rate. So now the property is going to be own, free and clear for the taxes. So people start bidding, so they bid. Maybe they have a five thousand dollar certificate. Do they get it? Or this is something different, where they're actually building on tax liens that defaulted.

Ted Thomas:

Okay, so the tax lien, that's defaulted. They'll notice that on the county website and they'll put it in a newspaper like this. So this particular one at $40,000. If I get another one here it'll be even more. I'll show you that as we go.

Ted Thomas:

All right, so that certificate, when you bid on it. So they say who wants this certificate? People raise their hand online or offline. So tax certificates generally are bid down. So the $5,000 you can't change because that's taxes, can't change the tax. So they bid down the interest rate and the lowest bidder gets it. The lowest bidder gets it, not the highest.

Ted Thomas:

Okay, so you have to be careful when you go to an auction. You have to learn this. You know what. You go there and you expect you to make 18%, but then someone over here bids 17 and a half and someone's 17, someone's 16. The lowest bidder is going to get it. So you have to really pay attention to what you're doing. At a tax lien certificate auction Now, at a tax deed auction, it starts at the low price of back taxes. So in other words, the property has a tax of 5,000. That's where the tax, where the bidding, will start. And then, because the property is worth, say, 100,000,. Some people are going to bid 20,000 for it. Some people are 25, 50. Some people will bid full price. It's up to them. But you can buy properties at those auctions for anywhere from a low of 10% all the way up to 50%. Now, you're not going to get a colonial house.

Dwan Bent-Twyford:

No, no, no, no, you don't, but it's a good way to get property.

Ted Thomas:

It's a good way, because you can buy them for 30 or 40 cents on the dollar, with no mortgage and no deed of trust on it, all right. And so those properties, those properties, are in auction. Well, I'll show you a place. Some of those auctions are huge. For example, I'll show you a really big one. So this is an auction list from Los Angeles. You just seen the cover. This is how many properties are going to have. Wow, there's 2,000 properties at one auction. Not California, just Los Angeles. This is one county.

Ted Thomas:

Oh yeah, San Bernardino will have double this. San Bernardino County will have twice as many, and so these properties start. Some of these properties are $5 million, $10 million. Other properties are just going to. Average in Los Angeles is $900,000 for the median price.

Dwan Bent-Twyford:

Yeah, just for a median house.

Ted Thomas:

So you know, sharon, and I back when we worked.

Dwan Bent-Twyford:

We were working in Fort Lauderdale, so we went to the Broward County. We were going to go buy some tax certificates and I did not know at that time because it was like brand new for me. And I did not know at that time because it was like brand new for me and I did not know you yet. And the bidding was like whatever, it was like 18%.

Dwan Bent-Twyford:

And then people started bidding backwards and we're like what's happening right now, and so I learned, like on the spot, that people bid down and then whoever will take the least amount wins it. So we're there, we're like, oh, we're going to buy a whole bunch of these today, we're all excited. And then you got to really, so we're learning as we went. I think we bought a few, but there were people that would come in with a paper like that and just bid on just hundreds of things, just all day bidding, bidding, bidding.

Ted Thomas:

This is where you want to be careful. So what I did? So people see me do this on YouTube. They see me hold this stuff. So they say I'm going to go down and buy those. Well, what they do is they go like this I'm going to buy those three right there. Well, wait a minute, you wouldn't marry the man if you didn't see him. You've got to go look at that property. What if it's in the middle of the ghetto? I mean, Broward County is the most competitive county in the United States. Oh, I believe it, More competitive than Miami. Miami-dade is competitive, but Broward's the most competitive. If you buy something and you haven't looked at it, you are a big-time risk taker. Because what if it's a bad property? No one's coming in and paying for that. If they don't come in and pay for it, you're going to get the property. Do you want a bad property? What are you going to do with it?

Dwan Bent-Twyford:

That's right.

Ted Thomas:

So people don't pay any attention. They just think, oh, this is a good sport to go down and start doing the people that get educated in this business. They make small fortunes. I mean make $50,000, $100,000 per deal. This is not unusual. If you watch one of my videos, you'd see people making $25,000 and $50,000. If you watch one of my videos, you'd see people making $25,000 and $50,000 regularly because they're doing a process.

Ted Thomas:

It's just like anything, whether it would be working on your hand and doing surgery or whether you're getting your hair fixed. It's a process and it has to be done correctly, otherwise you get orange hair or a big infection in your hand. You're getting my point. I get it. Well, you know what happens. Right, because people don't know the process. And if that's the case. So this is a process business and if people follow the process they can do well. If they don't and they wing it, they get in trouble. I get young people. They want to get rich quick. It's a problem. My average client is 45 to 105. Young people don't do this because they don't have the money. They want to go buy a BMW or they want to try to get a down payment on a condo or something right. So I get adult people, so the people that come to us, we're able to give them training. That's the difference. Same thing you're doing. You're mentoring people and guiding them step by step, and that's what it takes to make money today a step-by-step process.

Dwan Bent-Twyford:

And you know it really does. I mean you and I have been in this business. You know over 30 years each in different fields, but it's the same thing I tell people. It's like if you want to learn how to buy and sell foreclosures or you want to be a landlord or a rehabber, like I did, wing it back then because there was nobody teaching in 1990. So I learned seat of my pants. But then by the time like those learning antics, those kind of events came, there were people like you and people like me that had systems and programs that could say look, cut your learning curve, let me just show you how to do it the right way.

Dwan Bent-Twyford:

And same thing, the first tax certificates that I ever went to at Broward County, sharon and I don't know. We're sitting there, we're thinking we're going to bid on all this stuff and everybody's bidding things down, and then I guess there must have been some tax defaults and some people ended up with buying land that was like kind of in the Everglades, like where they had planned to build but they never did. So everything was all swampy or they'd buy a bunch of pieces together but nothing was not a big enough space to put in a septic and I mean I know some people that ended up with and they're like oh yeah, we didn't go look at it. We just thought you know it's a piece of land, it's got to be good. So now that's not necessarily true. You need to know what you're doing.

Ted Thomas:

Yeah, and people buy. Unfortunately, especially in Florida, they buy land where they don't know where the land is. So you are right next to it because you're right next to Lake Okeechobee. So I've been at auctions where big companies will come in, whether they're banks or a hedge fund, and they'll buy 3,000 certificates off the list. So they're doing that in West Palm Beach.

Ted Thomas:

Well, part of the land that's mapped out is under Lake Okeechobee. Where are they going to do a property under Lake Okeechobee? So what's going to happen is they're going to give their money to the county. There's no one ever going to come in and redeem that and pay for it. So they lost, they're going to lose their money. So people say you can't lose, you get a little instruction, you learn just things to avoid. So it's very important that people take some kind of training. I remember when you were the only person they could go to for short sales.

Dwan Bent-Twyford:

That's right, the short sale queen. I have the trademarks still to this day.

Ted Thomas:

Well, when you did that, you had to go step by step, fall down, step by step, fall down until you could write the book. You wrote the book. Well, I wrote the book on tax liens and deeds. And I tell you, it wasn't so easy to write.

Dwan Bent-Twyford:

I know, I know I did. I was doing short sales and then I trademarked the term short sales as it applies to real estate and it's like, hey, I still have that trademark to this day. It's like I'm always keeping that trademark. I worked hard for that.

Ted Thomas:

Yeah, darn right, so it's the same story People that don't take training. There's a certain group, but the clients that I attract, I don't get anybody that doesn't have gray hair. They get gray hair and they're conservative. We can teach them all the steps. It's not unusual for us to have people at 80 and 90 years old going to auctions. Yeah, not unusual, but they know what they're doing. They know what they're not guessing, whereas the other people that go and guess most auctions I'll say 80% of the people you'll see at an auction have never had any training. I've never talked to anybody. They just show up. The word auction means bargain to them and so they overbid to win the auction. What are you going to sell it for? If you overbid, overbid property, there's no way you can sell it. It's impossible. People don't understand that.

Dwan Bent-Twyford:

They do. They hear the word auction like, oh, it's going to be a great deal, it's an auction and it's not necessarily a good deal. And all the different counties around the country? Then is all the bidding on the tax certificates the same. You start here and people bid backwards. Is that the nationwide concept?

Ted Thomas:

The challenge with the taxing business is it's not because some states, like South Carolina, you can actually bid them up. They bid up like you would bid on a property. But South Carolina is such a good state to do it because if you bid up and then the people don't come in and redeem it, they just automatically send you the deed. You don't even have to foreclose, they just send you a deed to the property and you own it. So that's how easy it is there. If you go to Texas, texas and Georgia are my two favorite states because if you buy in Texas, when you raise your hand and you buy a certificate, that certificate pays up to 25%. That's so much money. So what happens is, when you bought the certificate, the property owner has 180 days to come back and buy the certificate back. If they don't buy it back, you get the property in 180 days. That's nice. In Georgia you can buy it and earn a 20% return in one year, 30% the next year, 40% the year after that.

Dwan Bent-Twyford:

Dang. So then, like the bank steps in and redeems it, they have to pay you the 20% and 30% and 40% for each of those years.

Ted Thomas:

If the bank wants a certificate, they will come in and pay for it. Most of the banks just walk away from it because they don't want the headaches.

Dwan Bent-Twyford:

Yeah, they do, they do.

Ted Thomas:

Yeah, they don't understand what they've got, so they walk away because they don't want to hire an attorney and go through all that. Now, on a big colonial house that's worth $800,000, they're going to come in, but on small parcels of land and small properties $200,000 properties the bank's just going to walk.

Dwan Bent-Twyford:

Yeah, they do, they do. They let them go all the time. And so now someone gets the tax certificate. It's gone through the process, nobody redeemed it. They get the deed to the house and then they can do whatever they want with it it's their house.

Ted Thomas:

Right, it's their house, and the only thing they'll have to do is they'll have to get a legal procedure done, called a quiet title action.

Ted Thomas:

Yeah, that means the attorney goes out and checks all the reports to make sure that the title is correct, because banks won't accept properties that were delivered from the county because they don't know if the county did all the work right or not, and so you have to get a quiet title. 99% of the time the county does it right, but you'll have to get a quiet title or you couldn't finance it.

Dwan Bent-Twyford:

Yeah, I forgot about that. It's like oh, quiet title, I remember that. Yeah, some of the terms you don't use them for a long time. You're like, oh, remember that. Yeah, so you get like a title company that does a quiet title. They just confirm everything's clear and free and then boom, you've got your house for the taxes.

Ted Thomas:

Yeah, yeah, you have to use an attorney for that because it's a lawsuit. Yeah, quiet title is a lawsuit, so it has to be done with an attorney. So you're kind of getting the idea. So I have all kinds of clients. I have them all over the place. I have clients that are in the United Kingdom. I have in Mexico, mexico City, all of the United States. We're really big in Canada. When I finish this, I'll have Linda put a couple of testimonials in and tell you about some of those people so you can see what they do and how they did it. Women are especially good at this business and I'll tell you why it's because I don't teach fixer uppers.

Dwan Bent-Twyford:

Yeah, exactly.

Ted Thomas:

I say just do the engineering of learning how to buy it, learning how to sell it and sell it to guys and gals that want to fix it up. So this is a business that you buy low, get a little bit of margin, sell low to a fixer-upper or someone that wants to be a wholesaler and move on to the next one. There's 5,000 auctions every single year. There's such an abundance it's rare for them to be able to sell all the properties at auction. Yeah, this isn't overwhelming People. They're not overwhelming. You can go to auctions. There'll be 800 people there. Just use the 80-20 rule. Maximum of 20% will do anything. All the 80% of they're just looking.

Dwan Bent-Twyford:

Oh, what's happening? They're just there to watch.

Ted Thomas:

Yeah, that's all they're there to watch.

Dwan Bent-Twyford:

I used to like to go to the auctions at the courthouse steps, like in Broward County and Palm Beach County, and you just walk in. There's so many people. You're like, oh my gosh, I'm never going to get a house for so many people. But most people are just watching. There's just a little handful and you see who they are. And then they're there every week or every day or however often it is. They're there all the time buying and buying and bidding on things.

Ted Thomas:

Right. Right, people are in the business, go to the auction, are in the business, go to the auction. So there's enough room for everybody Anybody that wants to do it, and there's enough states to do it. And the beauty of it is because what's happened in the last actually over 10 years, but in the last two or three years, all of the counties have come online. There's only a few counties that aren't online now, and so now we can teach people to sit here in the office and they can do all the research on the property, know everything they want to know about it, and they can buy property online if they want.

Ted Thomas:

Yeah, we have one rule. That rule is don't buy anything where you didn't walk on the property. That's right. If you haven't seen it, don't buy it. Get your shoes dirty, get the rain coming down on you, because it's always raining. When you want to look, there's always something wrong. So you want to look, because if you don't know what you bought, well, you've got a big problem in your hands, but you can do all of it online now. So women are very good at online number one. But number two they don't have to get. Really, you don't have to be a super salesperson because you see you bought it low. So let's say you bought it at 30 cents. Hell, sell it at 50 cents on the dollar and every rehabber in the world will be beating on your door because they're going to put all the heavy work in it.

Ted Thomas:

Now they deserve what they do they have to work hard? I mean, they really work hard? Oh, they do. No broken fingernails, no pain in your hair, none of that.

Dwan Bent-Twyford:

So women do especially well, especially well, in the school I get it. So the people that just want to like I just want to buy certificates sit on them for a couple of years and then they get redeemed, so and maybe they get it at like 18%. They paid $5,000 for it, so they're making 18% each year. So if they have it for two years before it's redeemed, they make 18% each year. So if they have it for two years before it's redeemed, they make 18% the first year, 18% the second year. So someone that just wants to buy the certificates and wait for them to be redeemed, they could have hundreds and hundreds of them at a time, as long as they've got the cash for them.

Ted Thomas:

As long as they got cash to buy them. I have clients that have bought up to 700 certificates over a period of a couple of years, so then their cash starts coming back. Yeah, they can just keep buying more and more and more. 95 to 97% of all those certificates are going to pay you. Yeah, they are. You pray that you get one that doesn't pay you and then when that happens, I'll even put a little testimony on there so you can see it. This couple in Phoenix bought one. They spent $11,000 on the certificate and the people didn't come in and pay. Turned out it was a $150,000 condo they bought. They went and looked first and it was on the water. They bought it. They paid the taxes on it. The people never came in and paid. They ended up selling it and making $160,000. That's not unusual.

Dwan Bent-Twyford:

It's not unusual and you know the reason I think a lot of that happens is a lot of the people that buy those certificates. When they don't get reimbursed, it's because maybe someone from another country bought a second home in the States and they don't understand. If they don't pay their taxes, then it gets sold, because I've had a lot of. I actually had one in Hollywood, florida, that we bought. That was a little condo, like a little one bedroom condo on the beach, and Sharon and I ended up getting that. We were like, oh my gosh, we have this little like efficiency right on the ocean in Hollywood and the people that owned it were from Canada or somewhere like that and they just they didn't know how it works here in the States. So you do end up with a lot of properties, especially in like tourist areas where people buy from out of country and don't know how the tax laws work over here.

Ted Thomas:

Well, you know it works the same way, you know reversed, because the people in Michigan, you know, they come down here and they buy and they forget about paying the taxes so they could lose the house. But you know, floridians, a lot of Floridians, they want in the summertime, they want to go out and be on one of those lakes in Michigan, they want to be on a lake, go fishing, it's nice and cool at night, and all that they forget to pay their taxes. And so we have a bonanza going on right now in Michigan where my clients are buying properties in Michigan because people haven't paid the taxes. It's amazing. So it works both ways. People have so much they forget to pay the taxes.

Dwan Bent-Twyford:

They do and they just don't know. I mean, if you have a mortgage that has principal interest taxes and insurance in it, your taxes are going to get paid, but a lot of people buy things free and clear and then they just it slips by.

Ted Thomas:

Young people get a mortgage with all that stuff in it. People that are buying their second property. Like you said, a lot of them pay cash. Yeah, Some people pass away. When they pass away and there's no relatives, those houses are all up for sale.

Dwan Bent-Twyford:

Yeah.

Ted Thomas:

So it's not an unusual business.

Dwan Bent-Twyford:

Well, let's jump topics for a minute. So everyone, you are definitely the godfather of taxes. So everyone just go to tedthomascom and you can find everything out. Possibly that this man knows and I'm telling you from personal experience. I've seen him for decades working and doing this and making millionaires and helping other people and things like that. So let's go talk about some personal things. What's your favorite band of all time? Tell me your favorite band of all time. Who do you love to listen to?

Ted Thomas:

Oh, my goodness, I'm really going to date myself. I loved Glenn Miller and all the old bands.

Dwan Bent-Twyford:

I do too, though.

Ted Thomas:

Harry James, all that I mean. When I went to, you know, after regular school I went to the college things. They were still touring in those days, which is 1960 for me. That was a long time ago.

Dwan Bent-Twyford:

I like the music from the 40s, like the big band music from the 40s.

Ted Thomas:

Yeah, that's what I'm talking about.

Dwan Bent-Twyford:

Yeah, I know I know Glenn Miller I have on my TV has Sirius Radio I put on the 40s, all the time that era of music is like. It's so peaceful.

Ted Thomas:

You can even understand the words.

Dwan Bent-Twyford:

You can understand the words, there's no cursing and it's such a nice music. I love 40s music. I listen to it a surprising amount because it's just really peaceful. It makes you want to dance. You're like, oh, I want to get up, I want to do a ball. Yeah Well, that's good. Glenn Miller, good for you. What kind of food? What's your favorite thing to eat? What do you like to eat when you go out?

Ted Thomas:

Well, if I go out, I'm not a gourmand, as they say, although I did spend part of my life studying wines and food. Now I'm really happy with a sirloin steak and a baked potato.

Dwan Bent-Twyford:

So I'm an old school guy that likes that with lots of veggies. I like just the steak, no veggies.

Ted Thomas:

I'll just take a veggie steak. Oh no, you got to have veggies. You got to have veggies.

Dwan Bent-Twyford:

Yeah, I know I really have to make myself be better about that. I'm a meat eater. I could just eat meat all the time. But then I'm like no, I got to make veggies. No, I got to have some salad.

Ted Thomas:

I'm a meat eater. No, no, I could eat the meat all the time, but I'd probably get sick.

Dwan Bent-Twyford:

Yeah, as we get a little older, we have to be more cautious about what we eat.

Ted Thomas:

I lose weight if I eat meat.

Dwan Bent-Twyford:

I eat meat, I lose weight. Yeah, yeah, yeah, I think everybody does so. What's your favorite part of the day? Waking up to go to bed? When is like, where's your happy time?

Ted Thomas:

I'm happy most of the time, but I I'm a morning person. I don't mind being solo by myself. My first career was a pilot, so I was very lucky. You start early days and we could watch the sun go out. So my first major flying job was with Aloha Airlines in Honolulu, hawaii. So when you took off out of the Honolulu airport you headed east towards the big island. We watched the sun come up over the Pacific. We finished the last flight of the day, that's at nine o'clock at night, right. So we're leaving the big island after many trips back and forth and now you can see the sunset of the day. So both of those times today are the favorite time.

Dwan Bent-Twyford:

I love that too. I love that too. So what is your biggest goal Like right now, ted Thomas? What's your biggest goal that you're working on, and how can the wonderful family help you achieve that?

Ted Thomas:

Well, thank you, that was a nice thing to say. My biggest goal is to do more of what I'm doing now and just stay alive. I had a stroke three years ago and so I lost my balance All right, so I can't fly anymore. So I always have to be touching something Like right now I touch the table, or my butt is in the chair, so otherwise I'll lose my balance and I could fall. The table, or my butt is in the chair, so I, otherwise I'll lose my balance and I could fall. So my, my goal is is to live five more years and then all what I have I've already signed all the papers.

Dwan Bent-Twyford:

I'm giving it all away to Habitat. Oh wow, that's really amazing.

Ted Thomas:

Yes, Well, that is sweet.

Dwan Bent-Twyford:

Well, let's hope that you make it more than five years. 90 is too young. I feel like you're one of those?

Ted Thomas:

Oh, I don't know about that. You need to hang on to like 100. All right, hang on to 100.

Dwan Bent-Twyford:

Give us a little. I got to get out of here.

Ted Thomas:

I got to get out of here, though, so the young people can take over.

Ted Thomas:

No, no, you just keep teaching them again All right, so the best way, yeah, but let me tell you something we do. We need to do a promo for your clients, okay, so I'm going to give you a promo code. That's really easy. Okay, it's Dwan, d-w-a-n 50. Okay, so you want to go to? That's the promo code. Go to TedThomas, slash Dwan. And what they can do is I do every other week, I do a six-hour virtual so they can sit at home, put their feet up, they can have breakfast, they can have lunch. We're going to do a six-hour class Now. Usually I charge 47 bucks. It's only $23. Okay, I always charge for everything. I'm not doing anything free, and what we'll do is they can come through that If they ever wanted to learn about tax defaulted property or tax liens. They will know more after that six hours than you and I learned in our first three years.

Dwan Bent-Twyford:

Oh, here, here. So tedthomas. com forward, slash Dwan50.

Ted Thomas:

You can do that and it'll go right through. That'll be perfect and it'll go right through.

Dwan Bent-Twyford:

Okay, so I still have one more question for you. So before we wrap up, let me do my wrap up, and I got a really good question for you. So, folks again, dwan meant Twyford, america's most sought after real estate investor. You can find me at dwanderfulcom, so Ted's known me a long time. So I took my name Dwan and wonderful, and I made a new word, so hence the world of dwanderful. So you've always told me I've always been outgoing, I've always been out there. I'm like you know what? I'm getting older, I need some pink hair. I can't have gray hair. I have to be D'Wonderful, I need something amazing. So that's how D'Wonderful came to be. If you opt in over there, I have some. You not. With Ted Thomas, I want you to subscribe to my podcast, leave a five-star review and write something, because podcasts are definitely a labor of love and we can't grow and get bigger without your help. And, ted, I don't know if you know this right now, but right now on Spotify, my podcast is like in the top 50.

Ted Thomas:

Wow, Congratulations. I know I get Congratulations. I know I got. I get notifications.

Dwan Bent-Twyford:

I'm like I was number 47. The other day I was like 47 on. Spotify under the category of business. It's like oh, my word.

Ted Thomas:

So keep the pink hair. Because my assistant said I said I know this woman and she said she's got pink hair. That's the first thing she said. I said well, she was glamorous 25 years ago, so I can't imagine now. And then here we are.

Dwan Bent-Twyford:

I'm in breaking gray but, I, can't be all gray. I have to have some fun. Yeah, yeah, yeah.

Ted Thomas:

I have white, I have white.

Dwan Bent-Twyford:

You do? You look fabulous. Honestly, it's really such a blast in the past. I can't wait to tell people that I interviewed you and talked to you, okay, so what I want you to do, Ted, is I want you to give us a parting word of wisdom, but it can only be one single word, one word Results.

Dwan Bent-Twyford:

Okay Now. So everyone that listens to me knows every week, when our guest gives us our word of the week, our parting word of wisdom, you're going to write a little sticky and you're going to put it up on your mirror and every day you're going to say results, results, results. That's your word of the week. So tell us what that means to you, so they know what you think the word results means.

Ted Thomas:

Well, I have a policy with my company because I have a lot of young people that work with me and they're always afraid to make mistakes. So I say it. They don't always believe me, but I say it continuously. I say, look, just do it, and if you make a mistake you can't get fired. You make a mistake, you can't get fired, because the only way I evaluate people is those seven letters results. What result did you prove? Now, if you make a mistake, just don't kill anybody. I mean, don't run someone over. But if you make a mistake with a computer or with a client, we can call the client back and say, look, we made a mistake and it's okay to do that. The heck with the mistakes, because people grow like this, yeah they do.

Ted Thomas:

Listen, I said it. I can only say this to very few people. I can say it to you. Listen, I said it and I can only say this to very few people. I can say it to you because you created a subject. You created short sale. There was short sales for executives and for people that really knew big-time real estate, but there was no little person like us real people that knew what short sale meant. And then you came out with this big package of things short sale. I still have it on the shelf.

Ted Thomas:

Next time I see you, I'm going to hold it up and show it to you. So you started something, but you didn't start something without leveling out, crashing down, going up Each time you went up. It's like the first time you try to do a pushup, the first time you try to go on a diet. Just grade yourself on the result, that's all. So I tell my people I'm just going to grade you on result. You would be amazed how it changes people. But they have to be reminded constantly and we as people have to remember to grade ourselves on result, because we botch it up all the time.

Dwan Bent-Twyford:

Yeah, that's really kind of profound, actually, because I have some people that work for me that are younger and whenever they make a mistake they're always like I hope John didn't fire me. It's like I'm not going to fire you, like I'm teaching you. But you know that's true. Just the results are the big picture, because everyone's going to make mistakes. Nobody gets it right all the time.

Ted Thomas:

Fail forward fast.

Dwan Bent-Twyford:

Fail forward fast, okay, so after I uh say goodbye here, I want you to just hang on and stay with me for a second. So again, folks, ted is he. He is really the godfather I'm really. Honestly, it's like my heart's just warm seeing you again today. So go to ted, thomascom, forward, slash duan, and I would highly advise you to watch one of those weekends. I think, ted, I do have, I know I do. Down in Florida I have some an old training Maybe I got back from like the learning annex days and I'm going to have to dig it up too. So next time I see I can say, hey, I went to sign my, my.

Ted Thomas:

OG copy. If you can find it, send it to me and our all new programs come out in December. We're just finishing them now, all new, and I'll send it to you.

Dwan Bent-Twyford:

Yeah.

Ted Thomas:

Send me the old one, I'm sure.

Speaker 2:

I do.

Dwan Bent-Twyford:

When I go to Florida next time I'm going through my old bookshelf I'm going to find it, because I know for sure that I have it and I like your words, results and thank you for being a guest. You've been very kind and generous with your time and your effort and all of your crazy knowledge. So, folks, we'll be back again next week. Same bat time, same bat channel. And just remember that the truth is in the red letters. All right, everybody. Ciao, I'll see you next week. And Ted, again, thank you and see you next week.