Is a redeemed tax lien actually a fixed income position or something else entirely

Take this as a framing question rather than a settled answer. What pushes toward the lending framing is that the acquisition path has steps that would need to be learned and paid for, with low odds of ever walking it. If nine out of ten certificates redeem, that means building a whole foreclosure competency for an event that happens once every couple of years. That looks backwards for someone with 10k to place who wants yield, not a side project.

Cobalt, I ran it as lending for two years and then got a parcel I didn't want. Unimproved, sloped, no legal access I could establish without a survey and a lawyer. Cost me more in time than the certificate ever earned. So now I underwrite the dirt on every single one even though I expect redemption. It's cheap insurance against the outcome you didn't plan for, and it's why I vote for the property framing even though the yield is the actual product.

Both of you are describing the same discipline from different ends. Keystone screens the parcel to avoid a bad outcome, kestrel skips the screen because the outcome is rare. The screen costs maybe twenty minutes per parcel once the routine exists. Assessor card and aerials, plus whether the thing is a mobile home or a strip of leftover right-of-way. Twenty minutes times forty parcels is a day of work, and it takes the worst results off the table.

What I don't understand yet is the redemption side. Who actually pays me, the owner or the county, and does the county chase them or do I have to do anything. If the county handles all of it then the lending comparison makes sense to me because it's genuinely passive until it isn't.

Ember, the county collects and pays you out in most tax-lien states, though the mechanics and the timing differ by state and you'd want to read the actual statute for wherever you're bidding. Nothing to chase while it's performing. Cobalt, on your split, I think what it comes down to is that the yield pays the bills and the parcel risk sets your bid. That's not both framings, that's one framing where the dirt is a constraint rather than a goal.

Tally's version is close to right. Treat anything you might end up owning the way a builder walks a job site. Plenty of parcels look fine on a map and turn out to be a drainage pond or forty feet of hillside, or sit under an easement. The point of the screen is to avoid inheriting a liability for $900, whatever the odds of a windfall.

This thread is the argument for giving any lien list a column for what you would do if the parcel actually came through. On most lists the rows in that column say nothing useful, and that says something about the parcels being collected rather than about the strategy itself.