Tax lien certificates are a type of investment that can provide investors with a high rate of return. They are secured by a lien on the property taxes owed on a piece of real estate. When you buy a tax lien certificate, you are essentially lending money to the government to cover the unpaid taxes. In return, you receive a certificate that gives you the right to collect the taxes from the property owner, plus interest.
Tax lien certificates can be a good investment for several reasons. First, they are secured by a lien on real estate, which makes them a relatively safe investment. Second, they can provide a high rate of return. The interest rate on tax lien certificates is typically higher than the interest rate on other types of investments, such as bonds or CDs. Third, tax lien certificates are a relatively passive investment. Once you purchase a certificate, you do not have to do anything to collect the taxes. The government will handle the collection process for you.