My blended IRR keeps landing at 7-9% against a 12-18% headline rate

Your subs line is doing more damage than the cash drag, and there's a second reason to keep paying it beyond protecting position. In several states a later certificate holder on the same parcel can end up ahead of you or force your hand on timing, and the mechanics differ enough state to state that you have to read each statute rather than carry one assumption across all three. The good news is subsequent taxes usually accrue at the statutory rate too, so that 8% isn't dead capital. Worth separating in the model, because right now it reads like an expense.

The premium question is what I can't get past on your numbers. In a premium-bid state, if you pay $1,000 of lien plus $300 of premium, is the interest calculated on the $1,000 or the $1,300? I assumed $1,300 and then read that in some places the premium earns nothing and isn't refunded on redemption, which would mean the headline rate is already fiction before any cash drag. If that's right your 7-9% might be the accurate number and the 16% was never real.

@vellum I landed in the same place, and it's why I keep looking at funds instead of doing this myself. Though @meridian, if a fund quotes net yield, is that net on committed capital or on invested capital? A 1.5% fee on the full commitment while a third of it sits in treasuries between sale seasons is a very different number from 1.5% on what's actually in certificates. That distinction seems like where the whole comparison lives and nobody's deck explains it.