Buying tax liens in New Jersey involves purchasing a at a municipal auction , which grants the right to collect delinquent taxes plus interest from the property owner. Investors in NJ typically use this as a passive investment to earn high interest rates, though it can lead to property ownership through foreclosure if the debt remains unpaid for two years. Core Investment Mechanics

: If the owner does not redeem within two years, the lienholder can file a complaint in the Superior Court to foreclose on the property. The 2024 "Equity Theft" Law Change Tax Sales - NJ Division of Local Government Services - DLGS

: If multiple investors want the same lien, they bid the interest rate down toward 0%. If it hits 0%, bidders then offer a premium (cash paid upfront) to win.

: Property owners have two years to "redeem" the lien by paying the certificate holder the full amount plus interest and penalties.

: Bidding starts at a statutory maximum of 18% and is "bid down" by competitors.