Q: I saw you at the recent Larimer County tax lien sale. But I also remember after more than an hour into the proceedings and about 250 people "buying" ahead of you, you passed when it was your turn. Why?

A: The tax lien sale is a great place to park money and earn a 14% yearly return. Many of the liens are available for only a few hundred dollars, some for even less. But it is also a "buyers beware" arena with many potential pitfalls.

Researching the properties is almost impossible. There were over 1100 parcels involved and possibly more than 350 buyers. With rotation bidding (you can only decide on the parcel next on the list when it is your turn), it is impossible to bid for only certain parcels. The County officials do try to screen the properties and hold back ones with problems. And almost all the time nothing bad happens to the lucky buyers of the liens, but whenever taxes are not paid, remember there are reasons.

Many experienced tax lien sale attendees have their own guidelines on properties to avoid. For example, many will automatically pass on anything labeled "tract" because it might be too small for a building permit or not large enough for things like a leach field. The term "tract" might also suggest an oddly shaped lot or access problems. But then again, nothing may be wrong.

Often the existence of other liens raises red flags, especially if the lien is on a piece of property that was sold at a prior tax lien sale and the owner of that lien did not elect to pay the lien this time around (past purchasers have priority to buy the current lien before the sale).

Successful bidders have found that their tax lien was on property with environmental problems (the cost of cleanup exceeding the property's value), or in such run down condition that fix up costs would make it a money pit, or that the property had been seized by the government for illegal activity, all of which means the money spent to obtain the lien may never come back or securing title to that property would not make sense. Buyers have also later discovered ownership of the property was clouded because of ownership disputes or adverse possession claims. And although the lien might take priority, the holders did not want to get pulled into the dispute.

After the sale is over, the wise participants will examine their "properties" to see if there is a problem. Some "investors" have had to walk away from thousands of invested dollars because they did not want to take title to the property when they did become eligible to apply for the deed.

Finally, these sales should be viewed as an investment and not a way to acquire title to property. Almost all of the liens are paid with interest at some point, either by the owners, new owners, mortgage holders, or others who stand to lose if the property is transferred to a tax lien holder. Officials in Weld County indicate that some condos and tracts of land have been sold to tax lien holders over the years, but in more than 14 years, only one lot with a dwelling has been transferred.

Q: I do not understand legal matters! If the contract says the Avs and the Nuggets can not leave, what is the problem down in Denver?

A: I tried unsuccessfully to telephone various "sources" and get the "inside scoop" so I am only speculating. If a team is leaving and the league approves, physically it may not be possible to keep the team in town. The Raiders defiantly left Oakland and Baltimore left in the middle of the night using rented trucks, or so the legend goes. And sports contracts are sports contracts. They seem to be broken easily either because there are "loopholes" in the contract, or damages are inadequate, or it would be too expensive and time consuming to pursue.

Thus, as further protection, Denver wanted certain investors to guarantee the teams' future stay in Denver. Now even though contracts and legal entities which actually own the teams survive an individual owner's death, personal guarantees will usually end at death. Or at best will be effective only until the estate assets are distributed to the beneficiaries, since thereafter there is nothing to reimburse for any losses. The only two solutions would be to keep an estate open for the number of years remaining under the guarantee so the assets are still attachable or take a security interest in the assets based upon the guarantee, neither of which would be very desirable from the owner's perspective.

Thus, the apparent standoff, but who knows what went on behind the scenes. And although the deal was pronounced dead on Tuesday, on Wednesday (when this column was being written), it might still come about.