Tax Lien Investing: $30K Lien to $850K Sale | Thomas Senatore

Thomas Senatore (00:00)

Well, because we did all the numbers and you owe $280,000 in back taxes. Like, how could that be? That’s impossible. She goes, they have not paid taxes in over eight years. So I had to go tell my partner what we just discovered, did the numbers. Thankfully, at the end of the day, the house had enough equity and value that when we sold the property and paid all the expenses, we still made about $10,000.

But we could have lost a couple hundred thousand dollars. And that was one of the key takeaway points that I learned that I tell everybody. Don’t take shortcuts.

Meghan Escobar (02:06)

Hello everyone,

welcome back to Real Estate Pros Podcast. I’m your host, Meghan Escobar, and today I have the pleasure of sitting down with an incredible young gentleman by the name of Thomas Senatore. He is the owner and founder of many businesses, but today we’re gonna highlight his experience and wisdom in something that he’s been doing for a couple of decades now TLD International, focusing on tax lien,

foreclosure and wholesaling of tax liens and so we’ll let him talk more about the details of what exactly it is that it is that he’s doing but I will say I am looking forward to this conversation as I’m pretty sure he’s gonna be bringing some value to the audience here. So when you’re dialed in here and you’re listening in be sure to have your pen and a piece of paper out.

To drop the gems down that he’s gonna share with us today. So Thomas, thank you so much for being here.

Thomas Senatore (03:02)

Hey Meghan, thank you for having me. It’s my pleasure to be here today.

Meghan Escobar (03:05)

Yes. So let’s dive in first and foremost for those listening in that may not be familiar with your name or TLD International Can you give us a 30,000 foot view of what your main focus is these days and what areas that you’re marr operating in?

Thomas Senatore (03:24)

Sure, agree. Yeah, so anyway, so TLD stands for tax lien deed. So that’s where we got the TLD from. And it started out that we looked into the tax lien foreclosure side of the business, where people that own real estate have to pay the property taxes. And when the property taxes weren’t paid, the county or city, whoever’s doing the collection, needs to go and offer these off to the public. And you can earn interest up to 18% per year. And as a brand new investor,

getting involved with it, I’m thinking, my gosh, 18%. This is great. I love it. And I and I started buying tax liens. And people would say that it’s really difficult because I don’t have the kind of money to get in, but yet it doesn’t take a lot. So we were buying tax liens anywhere between $500 and $1,000 at a time. and we would put anywhere between $10 and $15,000 per year away and we would invest it and we’re getting these returns. And by the second year,

I was able to acquire one of those tax lien properties through the whole process. Because the process is you hold it, and every state’s a little bit different, by the way, but I would hold it in New Jersey for two years, at which time I could then hire a law firm, which was nice because I was working at that law firm at the time as a paralegal doing these. We do the foreclosure. I ended up getting the property. So my $1,000 tax lien that I had to pay a couple thousand dollars the next couple of years

yielded me a property that was worth fifty thousand dollars. I was able to immediately just go and sell that property and make an amazing profit. And that got me thinking that this is pretty good. And then I realized that I could leverage it. I could find these companies that I was dealing with and maybe they would do what they call an assignment of tax lien certificate, which means they’re going to sell me their position for a fee. I would

Find the ones that are in areas that were not the best neighborhoods, that would be more of a risk for a large company who’s investing hundreds of millions of dollars, may not want this in their portfolio. I discovered they would sell it to me at less than face value. And one of the properties that I got was actually in a place called Jersey City, New Jersey. And there was a tax lien on a building that had a market value of a hundred thousand dollars, had four apartments and two stores, so it was a in a

residential mixed use area. They sold me the tax lien for $30,000. The tax lien face value is $45,000. And I’m thinking this is pretty good because I could buy it for $30, it could get redeemed, which means the owner would pay it off before the foreclosure started. I’d make a quick fifteen thousand dollars and I only had to wait 60 days. I’m thinking, wow, this is good. So I could go 60 days and make a 50% return. This is awesome.

So we go through the 30 days, get into the next 60 days, they did not redeem the property. I ended up becoming the owner of a building now that had a market value of a hundred thousand. I’m into it for thirty. And then we say, Well, what’s our exit strategy? Well, we didn’t have one. Our exit strategy was they were gonna pay us off. So looking at the numbers, we decided, hey, if we could fix this building up, get the four units fixed and rented.

The two stores fixed and rented, this building would have a value of 800,000. We could put in maybe 150,000. Let’s do it. And we did. So it took me two and a half years, and I sold the building for 850,000. And that jump started my investing career into the strictly tax deed side of the business, which was exciting. But there was risk. there was hurdles. We had to deal with

fixing up four apartments, redoing the entire electrical system in the whole building, updating the plumbing, but I had connections in the construction industry. So I didn’t get for cost, but I didn’t get them for retail either. I kind of got a wholesale price from the contractors knowing who I was. But it was amazing to take that risk. And the side note was I was the fifth person that looked at that project

And the first four walked away, saying, It’s not worth it.

Meghan Escobar (07:10)

Very interesting. So here you are thinking that, you’re gonna get this thirty thousand dollar tax lead and you’re just gonna make a quick fifteen, fifteen grand once everything’s settled, and then you get this property valued at much more to Yeah. Of course, yeah, like you said, there was risk involved and you had to do a little bit more, but the outcome ended up being a little bit more rewarding.

Thomas Senatore (07:33)

Right. And so we call it mitigating the risk. So we’re not risk takers. We analyze the risk. So my background prior to that is, before I started working in the law field as a paralegal, I was a general contractor. So I knew I could fix almost anything that came into play. Obviously, if it’s the main electrical servers gotta hire a licensed electrical contractor. But for the interior model, it wasn’t a big deal. But

The funny thing was I never looked at the property because I knew I was going to get my money back. So when the attorney said the foreclosure was done and I’m actually the owner, I had to go look at the property and see what did I just buy? But it was it was a good surprise seeing that the building was secure. There was nobody in there, was no squatters, there was no major damage. So we got lucky. But that could be one of the pitfalls.

an investor could fall into by not having that experience. Now, if I did not have that background to do all the work and be able to pull permits as a former general contractor, I could have had to spend $300,000 fixing it up. Right. Because now I’m paying for everything and I’m paying profit. So you need to go put together, we call it a power team. And I know you guys use a similar term. Have these people that can do the things

that you’re not good at and you’re gonna put in the things that you’re good at that they may not be good at and work together.

Meghan Escobar (09:41)

I love that. So is it safe to say, Thomas, that like what’s been keeping your machine running smoothly is the company you keep, the team behind you.

Thomas Senatore (09:52)

Absolutely. Because w without having those qualified individuals with different backgrounds and I don’t care what business you’re in, everybody has a strength and everybody has a weakness. And your weakness may be somebody else’s strength. Well then they become a really good partner because then you could put your strengths together and get more things accomplished. If everybody is good at the same thing and weak at the same thing, well then you’re not going to go very far. You’re going to be like on a bus full of

Excellent people, but no bus driver. It’s not gonna go very far.

Meghan Escobar (10:22)

You’re just on the road with no destination.

Thomas Senatore (10:25)

Yeah, exactly.

Meghan Escobar (10:26)

Yeah, that’s a that’s a good analogy. And every operator I know I know we you kind of talked about that deal, but it ended up being, better than what you expected. I always like to talk about the opposite as well, because a lot of our audience, they’re fairly new to

Real estate, they’re fairly new to entrepreneurship. And so every operator I know throughout their journey and I’m sure you’ve got years of experience. So you could probably share a great deal of, deals that maybe went sideways or a time that you had to pivot really fast. Would you mind sharing one of those moments that kind of sticks with you for the audience?

Thomas Senatore (11:03)

Okay, yeah, so I have one and it’s like kind of an embarrassing story, but thank goodness we made a profit. So w what happens is your mind gets in the way. So you think you know the answers and you start to take shortcuts. So for me, my problem was I knew in New Jersey that you could not go more than three years with delinquent taxes before the property gets foreclosed on. That’s the way it is, because every investor

Or most investors will wait the three year statutory period and foreclose and take title. So we found this one property in I guess it was in Bergen County, New Jersey. Beautiful home on a big piece of land in a in a very wealthy neighborhood. We figured it had a value between 300 and 400,000. And we could buy this tax lien for 150,000. We could start the foreclosure process and move and take title. So

We skipped some of the due diligence. We did go by the property. We checked the exterior. The exterior looked really good. It was well maintained. The ground was manicured. So we’re like, if the outside’s really good, the inside’s probably just as nice. But we didn’t call the tax collector to confirm there was three years of taxes due. We go and we buy it. We go to start the foreclosure. And then tax collector

When I called them, I said, I just need to have a payoff because we’re about to foreclose on it. And the response was, Well, I need to do a bunch of research and call you back. And I’m thinking, well, maybe they’re really busy. I’m hoping. That’s the reason. Three hours later, they call me back and they start the conversation off. Is this Mr. Senatore? Yes. Are you sitting down? I’m

Meghan Escobar (12:35)

Yeah.

Thomas Senatore (12:36)

like, why?

Well, because we did all the numbers and you owe $280,000 in back taxes. Like, how could that be? That’s impossible. She goes, they have not paid taxes in over eight years. So I had to go tell my partner what we just discovered, did the numbers. Thankfully, at the end of the day, the house had enough equity and value that when we sold the property and paid all the expenses, we still made about $10,000.

But we could have lost a couple hundred thousand dollars. And that was one of the key takeaway points that I learned that I tell everybody. Don’t take shortcuts. If you have a due diligence checklist, do not skip anything because you know what the answer might be. Because you could be right, but you could also be wrong. And sometimes those get in the way. But I do have another one which didn’t have a good ending.

It was dealing with a student of mine who bought this beautiful lot in Fort Myers. It had two houses on it. I told him that you got to make sure you check code enforcement, which he did. And he said, Yes, there was a was a code violation, and he was fine. So he ended up going to the auction. He bought the property, was a winning bidder. And I told him just go and confirm everything and verify what the amount is and just get it paid off right away. So he told me he was going to do it. But he decided he wanted to go to

Disney World for a week’s vacation because he was so excited he won this property. When he came back, he brought a contractor over to go look at the two houses that he bought to give estimates on the renovation. The houses were gone. They were not there. So I asked him, Did you verify the code violation? Well, no. What it couldn’t have been a big deal. Like a hold on, let me look it up. I look it up. I’m like,

Do you understand that this was a condemnation notice with a notice of demolition? Had you told them you bought it and you’re going to fix it up, you’d still have those two houses there. But now, not only you don’t have the two houses, you had to pay fifteen thousand dollars for each house they had to level. So now you just lost thirty thousand dollars. That investor lost close to sixty thousand dollars on that deal.

because they decided to take shortcuts and not follow up. And that’s key in any business you’re doing, and it doesn’t matter what it is, you gotta do your homework. You can’t skip steps because sometimes in my case we were lucky. In the other guy’s case he wasn’t so lucky.

Meghan Escobar (14:54)

That’s thank you for sharing that. That’s definitely, you know, the stuff that most people don’t talk about enough. And honestly what separates folks who are here to stay in the game long term versus those who are here to just, create a transaction. So

Thomas Senatore (15:52)

in i in so in my world for the tax lien and tax deed, and tax liens is not as big as tax deed, but in a tax deed, you have to go check the properties. You gotta inspect it. You gotta check what kind of liens are in there because people think that when they buy a tax deed, and there’s companies out there that teach it saying that you own the property free and clear of all liens, judgments, and encumbrances. Well, that’s not true. That’s not a true statement. County

And city liens survive a foreclosure. So you still gotta pay those. So if you don’t check it and see it, that could become a problem. Where I found a house that I bought. Actually I did it twice. sight unseen, I bought two houses. And both times they worked out well. But I bought a house in Port Charlotte on a main canal with a seawall, a single family house, and had a

s tax assessed value, which is always less than market value, of about $150,000. I bought it for $50,000.

Meghan Escobar (16:44)

Wow.

Thomas Senatore (16:44)

And I’m thinking, there’s a house, it’s on a lot, it’s got a seawall, it’s got Gulf access. If the house isn’t even there, I can still sell it for $80,000. So when I bought it, I went over and checked it out, found out the house was there. It was in good shape. And at the time I was working with a group of people teaching them how to do this.

And they said, Yeah, but you won’t be able to sell it for 60 to 90 days. So I made a deal with them. I said, I’ll bet you dinner that if I can’t sell it within 30 days, I I’m gonna buy you all dinner. And if we can do it unless you buy me dinner. Well, there was 10 of them, so they had the better deal. I sold it in five days. So I actually went on eBay and I put it on there for ninety thousand with all the pictures. I had five calls.

that wanted to buy it and want to know if those pictures were real and if I could videotape it. Because if it’s real, they’ll wire me the money that day. Wow. So it got sold in three days, made a great profit. And I explained to them, it’s not how much money you make. It’s how quickly you can turn the money and reuse it. And for me, I made almost twenty percent return in three days. So to me that’s a win. I didn’t need to make a hundred thousand dollars. That’s right. I can turn it

have my money back and reinvest it, I could keep multiplying it and compounding it.

Meghan Escobar (17:56)

Amazing stuff. Amazing stuff. Like I said, folks, he’s dropping gems. So pay attention to what he’s saying. There’s success in this story. So

One thing that I always like to focus on too is like where are you going next, Thomas? Like what’s the next big goal for you, for TLD? Like what are you working on?

Thomas Senatore (18:17)

So the biggest thing is I see in the industry and I hear that all the time, there there’s companies out there that are teaching the concepts. And I feel they’re not teaching it right. So they’re not doing things wrong. They’re not saying things that are illegal. They’re just they’re just not expanding properly. So when they say you’re buying these things free and clear of liens, judgments, and encumbrances, that’s great. But they forget to mention that there are some liens that survive.

And they like to push, well, you get to wipe out a mortgage. Well, that’s great, but what if you had a hundred thousand dollar code violation? It survives. So my passion was always teaching people. And what I would do is I would walk them through the process, technically, not physically, but walk them holding their hand, right? And just go through every step and show them, here’s my due diligence process, here’s how we do that, here’s how you

mitigate and limit any kind of risk whatsoever. Because in any investment there’s going to be some risk. But can we get it where the risk is minimal and it’s doable, where you can live with that risk. And that’s kind of the key that we’re looking at, trying to help people and get back into maybe doing these classes, help people, make them have the ability to create the wealth that they want to change their lifestyle.

Meghan Escobar (19:28)

Amazing stuff. So really for you it’s just putting the information out there for those who are looking to get to the next level in life and showing them that there’s ways to do it for pennies on the dollar.

Thomas Senatore (19:41)

Exactly. And everybody wants to have that path or roadmap to success. They just they lack that ability. And I mean I I’ve been teaching for years and years. And one thing I discovered is that the people they’re smart. I mean, the people listening, they they’re very intelligent. They’re not that they’re not. The problem is you don’t have that person just

nudging them or giving that push or saying here’s the confidence I’m behind you it’s a good deal let’s move forward and do it and it’s that’s the part that makes it because I would say like there’s this the person that has a thing on their shoulder saying it’s a bad deal you’re gonna lose your money don’t take the risk you don’t want to do it but then on the other side there’s somebody saying hey I got your back I’m gonna protect you I can walk you through it

Just you need to pull the trigger, take the risk, and see the wealth. And I found that once they’ve done it, they don’t need me anymore. Because now they built that personal self confidence level. Yeah. And that’s they need that in one form or another, they need to have some form or style of a mentor or a coach or a friend that’s gonna be a positive influence and not the negative side.

Meghan Escobar (20:54)

That’s right. That’s right. I can’t agree more. And every successful person you talk to them and they’ll they’re gonna give you some similar information. You need to have, people who are gonna believe in you, people who are gonna push you, because sometimes our own beliefs are not enough, right?

Thomas Senatore (21:09)

Yeah, exactly. and I’ve discovered, I mean, I’ve been doing this now for almost three decades. Every successful person had a quality mentor behind them to give them that confidence level or the additional knowledge or the steps to make it happen. because to try it on your own, you could be the, you know, the one that has the success. Right. Which could also be the one that

Loses everything because you didn’t have the right instruction, guidance, or mentor.

Meghan Escobar (21:35)

That’s right. That is that is correct. And you know, the end of the day, there’s one guarantee if you don’t take a risk.

Thomas Senatore (21:44)

Yeah. You’ll be at the same place you started at.

Meghan Escobar (21:47)

That’s it. That’s it. Very simple. And so with that, I know a lot of our listeners are, again, very early on in the journey, or they are looking for the next best thing. And so as we’re on the topic of building relationships and mentors, talk to us a little bit, Thomas, about what has made the biggest difference for you with growing your network.

Putting yourself in the rooms, creating those relationships.

Thomas Senatore (22:12)

The biggest thing was to build partnerships with different individuals. So for me, like I said earlier, my passion was teaching, right? And getting in front of people. And my strength was people seeing my passion when I’m out there talking to groups. I can talk in front of 10 people or 10,000. It I’m beyond that because you never see the first.

anything after 300 people anyway. So what’s the difference if it’s 300 or 3,000?

Meghan Escobar (22:38)

Right.

Thomas Senatore (22:38)

But it’s being able to share it and have the passion behind what I’m sharing and giving the content. And that’s what’s kind of lacking. We need to have the people that first of all, are they doing it? So if I’m going to teach someone how to do taxes and tax deeds, do I actually do it? Or am I just going to be the teacher? How about

I’m the person that’s investing and I’m gonna tell you what I just did, not saying, Well, here’s a book I read, here’s what the book told me to tell you. And I see that was a difference because that’s the people that taught me. I didn’t have educators teaching me, I had investors that were doing the business that were very successful at it. And then I would take everything they say exact, that my gosh, they did it, worked.

They’re not smarter than I am. I can do this too. And we all basically we all start at the same level. It’s just who’s gonna take the next step or just stand still.

Meghan Escobar (23:32)

That’s right. And there’s always gonna be one or the other. Yeah. So thank you for sharing all of that. And it it’s definitely something that you can’t fake. It in business relationships are everything. And real estate specifically, y you can’t build without having a team. You can’t build without people. So it’s it is important to

find those relationships and making sure that you’re putting yourselves in rooms of people that can help you grow, be resourceful, all the things. So all right. Before we wrap up, if somebody wanted to reach you, Thomas, and learn more about, how to go about purchasing tax liens, tax deeds, foreclosing, all the things, all the knowledge and the wisdom that you’re providing, what would be the best way for them to connect with you? Is it through a social media platform, a website, a phone number?

Thomas Senatore (24:16)

So we have all that. So we have a Facebook page and if they just Googled my name, Thomas Senatore, they’ll pop up.

So here’s what I tell people. your best to send me a text message. And again, I’ve helped people for years and years and years. so it’s not like I’m looking to go get paid for it. If you need some simple advice, and you have questions, you text me a message or email me and I’ll give you my email too. I respond, I pretty much control my time. And that’s why I got involved in real estate investing. You know, the old saying is, do you work for the clock or do you own the clock?

it’s me, I own the clock. So I own the time. So if someone needs some help, I’m there. And I’ve done that for years.

Meghan Escobar (24:51)

Absolutely love that. Thank you so much for your time. I appreciate everything that you’ve shared with us today. It’s I lots of value here. So you we need more people in this space that are doing things the right way. So I want to thank you again, Thomas, for taking the time out of your day to be here and providing this value for our audience. It’s been it’s been very helpful.

Thomas Senatore (25:12)

Yeah, Meghan, it was my pleasure. I’m just glad to be able to share this and hopefully it’s gonna help somebody down the road that wants to get involved in investing and do it the right way.

Meghan Escobar (25:19)

Absolutely. And for those of you that are tuning in, if you got any value from this, please be sure to hit like and subscribe to our channel. We’ve got more conversations coming in with operators just like Thomas Senatore here, who are bringing value, who are building businesses with real people in real time. We’ll see you on the next episode.

Thomas Senatore (25:38)

Thank you.