Site: OntarioTaxSales--Charges BIG fees for Townships to post Pictures {:^(

[netpred]

OK, enough of the love in. 

I do appreciate your candor Jeff. I have several other issues that have bothered me a bit about the way you do business. In no particular order:

Your fee structure is obviously your own business and I would be careful if I was in your shoes in giving out free info to new competitors about how your business operates. But, I can tell you why many municipalities use Real Tax but not OTS. Cost! The Real Tax fee is actually quite reasonable, especially when one considers what private law firms might charge municipalities.

In addition, you are a big player in this business. Much more influential than you think. Most treasurers follow everything that you say on your website, in emails, bulletins and at seminars. Please make sure that you are correct and not stating opinion. I am not sold on the HST issue at all and my information is that CCRA's opinion may not be accurate. I do not expect the tax man to voluntarily give up money if they can come up with any argument, however misguided, to justify the tax grab. Sometimes you have to pick a fight to get the right decision. So now every municipality charges HST because you tell them to. I understand that you are acting in good faith, but there is now a cost to me when I buy from municipalities that use Real Tax. Another example, I know that you talk in your seminars about the practice of double bidding. I think that it is ethically reprehensible to make a tender with no intent to follow through on it if the other bid is second. Will you advise a municipality what to do if the owner attempts to redeem after the first deposit has been forfeited? I don't think that this is the sort of advice that you should be giving but who do you think is the first person the treasurer will call if this happens? This is a discretionary matter for the treasurer. Otherwise, you would essentially make province-wide policy and border on unauthorized practice of law. My point is that you have tremendous influence in the tax sale industry. Please be careful when and how you use it and consider all of the potential ramifications.

I also have issues with double-ending. A lawyer who works for a municipality and who has conducted searches on properties would never sell the same searches (perhaps subsearched to update) to the public (at least the hypothetical competent and ethical lawyer). Do you not see a potential conflict with this type of model? What will you do if something unexpectedly pops up? For example, if a Crown lien comes on after service of the final notice or even after the sale, but before registration of the tax deed. You are, in my view, clearly caught in a conflict. I know that you can say that this is only a possibility, but if it does happen, then it becomes a reality. Have you considered your position in that event?

Of course my biggest beef with you is that you make it far too easy for amateurs to play this game. But I cannot find any fault with that. This is the very nature of your business and fair play. I can only wish that your companies did not exist but they do. OTS and Real Tax are simply a reality for me. So thanks for engaging in this forum and providing your views.

[Dave2]

I do appreciate your candor Jeff. I have several other issues that have bothered me a bit about the way you do business. In no particular order:

Of course my biggest beef with you is that you make it far too easy for amateurs to play this game. But I cannot find any fault with that. This is the very nature of your business and fair play. I can only wish that your companies did not exist but they do. OTS and Real Tax are simply a reality for me. So thanks for engaging in this forum and providing your views.

Netpred:

For your information Real Tax is not the only player in the business of advising municipalities.   On the other hand;

There is a saying if you can't beat them; join them.   Why don't you go into the business yourself.  That way what you lose on the apples you pick up on the oranges: A couple of interesting domain names for sale.  E.g.  

http://www.taxsaleproperties.ca/http://www.taxsaleproperties.com

Of course you would miss all the fun of working with your favourite conservation authority

While I lose some to amateurs its the pro's like this guy I am much more worried about. What really scares me about competition if he or one of the smarter people on this board (I don't include myself in that group) ever allowed Jeff to get the truth out publically, watch out. 

[26.2]

Of course my biggest beef with you is that you make it far too easy for amateurs to play this game. But I cannot find any fault with that. This is the very nature of your business and fair play. I can only wish that your companies did not exist but they do. OTS and Real Tax are simply a reality for me. So thanks for engaging in this forum and providing your views

My beef as well.  However it is not the fault of ots.  It is the fault of computers and the internet...sign of the times.  If there was no ots another similar company would be there and who knows, they might not have the integrity of ots. Every company needs to look at their bottom line and how to improve it.  I think ots is here for the long term and will want to keep us loyal.

What really bugs me, many properties go for market value or more.  Ots advertises the good deals on paper. Too bad there isn't a part of this forum that deals with properties that sold too high or they had problems.  Tax sales that go bad.  We hear of a few from distress calls.  Some posters here paid more than market value for a property that they could not legal inspect and they seemed thrilled

[netpred]

Of course you would miss all the fun of working with your favourite conservation authority


Dave:

Guess what? I have found another conservation authority that loves me also as much as what's his name. They really do get upset when you challenge them (and win)! Now of course this new authority has no match for you know who (I am sure that you have not forgotten - some memories you take to the grave).  

[Dave2]

What really bugs me, many properties go for market value or more.  Ots advertises the good deals on paper. Too bad there isn't a part of this forum that deals with properties that sold too high or they had problems.  Tax sales that go bad.  We hear of a few from distress calls.  Some posters here paid more than market value for a property that they could not legal inspect and they seemed thrilled

As Frank noted earlier when you beef about OTS you also have to consider the alternative.   Anyone who has encountered what I will call "interesting dealings" with a small rural municipality knows what I am talking about.  As far as I am concerned they are part of the landscape and we have to deal with it. 

What is interesting is that no one including the pro's like Frank and PFM have questioned them about the one situation where I would be worried about them?  We have the opportunity now so my question for a coffee (Timmies I cannot afford the more expensive alternatives)  is what is it?  (I will also allow OTS Jeff to guess it as well if he wishes)
   

[Frank]

What is interesting is that no one including the pro's like Frank and PFM have questioned them about the one situation where I would be worried about them?  We have the opportunity now so my question for a coffee (Timmies I cannot afford the more expensive alternatives)  is what is it?  (I will also allow OTS Jeff to guess it as well if he wishes)
   

Ok Dave...you owe me ---I'll take a cappuccino at Starbucks.   That question has been on my mind for some time, I'll pm you about it, and you can admit that you owe me. 

[g2020]

I am not sold on the HST issue at all and my information is that CCRA's opinion may not be accurate. I do not expect the tax man to voluntarily give up money if they can come up with any argument, however misguided, to justify the tax grab. Sometimes you have to pick a fight to get the right decision. So now every municipality charges HST because you tell them to.

I certainly have to agree with the position taken by Realtax/OTS with respect to H.S.T. I also think,  based upon your postings, that the position of CRA would be that you are in the business of buying and selling tax sale property. Anyone buying property with the sole purpose of reselling it at a profit could face a very punitive position by CRA when (not if) you are audited. I appreciate how emotional we are about HST but, at the risk of becoming even more unpopular, I believe that Realtax/OTS, is actually helping you with their position with respect to HST. They are not forcing you, or anyone, to pay HST. Whenever I am the successful bidder we immediately send our bank draft for the amount that the municipality's form says is owing, less the HST which they have included in the total. I also include an indemnification form which sets out the HST registration number for whichever entity, or entities, I have chosen to take title to that property. I also like to include a letter of direction setting out the address for service of the registrant that will be taking title. By doing this it keeps Realtax/OTS out of any issues with CRA, and the potential HST in your pocket. If you later sell the property to another registrant, such as a builder or developer, then you cannot charge HST. If you sell the property to a non registrant then Realtax/OTS is not involved - your lawyer, the purchaser's lawyer, and CRA can argue over whether or not HST should be charged. It is a pleasure to deal with Realtax when completing a purchase.
If anyone needs a blank copy of an HST indemnification letter they should be able to get one from their solicitor, although often the municipality can supply one. If that fails you can always PM me and I will try to attach one to an e-mail.
Oh, and about "double bidding", it does not work for three reasons. Firstly, it makes you bid more than you would otherwise, due to the false confidence created by your low ball. Secondly, there are way too many tenders for you to guess what will be number 1, let alone be able to call both the first and second positions. And thirdly, and most importantly, you cannot afford to add another 14 days to the redemption cycle - you need to get your money in immediately.    

[netpred]

I certainly have to agree with the position taken by Realtax/OTS with respect to H.S.T. I also think,  based upon your postings, that the position of CRA would be that you are in the business of buying and selling tax sale property.

Just because we talk big here certainly does not mean that we are in the business of buying and selling property. Perhaps some here have not bought any or maybe one - their "dream" property. Obviously the situation is different for an HST registrant or a person carrying on the business of selling tax properties.

[Dave2]

Just because we talk big here certainly does not mean that we are in the business of buying and selling property. Perhaps some here have not bought any or maybe one - their "dream" property. Obviously the situation is different for an HST registrant or a person carrying on the business of selling tax properties.
[/quote]
My accountant's position for what its worth was that more then 2 and you are deemed to be in the business of buying and selling land.  Remember that's not all bad because it also qualifies you for writeoffs and you can writeoff your input tax credit as well.  

BTW on another matter I acknowledge publically that I do owe Frank a very good coffee.  I want to handle whatever we are talking about with care and so I want to do a little more private messaging including possibly to OTS Jeff in advance before we come live. 

[Frank]

BTW on another matter I acknowledge publically that I do owe Frank a very good coffee.  I want to handle whatever we are talking about with care and so I want to do a little more private messaging including possibly to OTS Jeff in advance before we come live. 

Yeah...I win....do I know how to call them, or what. 
Make a double Dave   

[Dave2]

Yeah...I win....do I know how to call them, or what.  
Make a double Dave    

Gee I didn't know Gators liked Coffee.  Guess I will have to wait until spring as Roco is hibernating?

For Newbees a picture of Frank with his pet Gator Rocco.  Guess what will happen to me if I fail to pay the coffee

[OTS Jeff]

Here's a bit of a long post.  It addresses a number of issues that have been raised and comments that have been made.

>>>Anyone who has encountered what I will call "interesting dealings" with a small rural municipality knows what I am talking about
>>>What is interesting is that no one including the pro's like Frank and PFM have questioned them about the one situation where I would be worried about them?  (I will also allow OTS Jeff to guess it as well if he wishes)
I'm afraid you've got me on this one.  I haven't got a clue.

>>>If there was no ots another similar company would be there and who knows, they might not have the integrity of ots
Thank you very much.  OTS employs professional people with professional backgrounds and expertise.  OTS has been around since 2005, and Realtax has been around since 1996, and both companies will be around for a long time to come.  We have, and will continue to, conduct ourselves with the highest standards of ethics and integrity.

>>>I would be careful if I was in your shoes in giving out free info to new competitors about how your business operates
I don't think I've given out too much information on this forum.  What I've given out is the bare bones of doing tax registrations and tax sales.  The services that Realtax provides to its clients goes far beyond these bare bones.

>>>Most treasurers follow everything that you say on your website, in emails, bulletins and at seminars. Please make sure that you are correct and not stating opinion.
I sincerely do my best to separate my opinions from fact.  I hope that I've always been successful in this.

>>>I am not sold on the HST issue at all and my information is that CCRA's opinion may not be accurate.
I was hoping that CRA would conclude that tax sales are not taxable.  Sadly, that's no the conclusion they came to.  But it is my duty to let the municipalities that Realtax does business with know about CRA's interpretation.

If some person, or some municipality wished to challenge CRA on this issue, who knows, maybe they would be successful.  But a trip to tax court would likely be quite expensive.  I would guess that the legal fees would easily be in the tens of thousands of dollars, maybe more.  And there's no guarantee of who would win.  And keep in mind, CRA has very deep pockets.  And they have very deep reasons for not wanting to see their interpretation overturned.

>>I know that you talk in your seminars about the practice of double bidding.
That issue has been raised more than once at seminars that I was teaching.  My response to it is to let municipalities know what the ramifications of this situation are.  I try to stick to the legalities; that's what a treasurer needs to know, regardless of the ethics of submitting more than one tender.  To do other wise would be ethically wrong on my part.  It could lead a municipality into a lawsuit that could have been avoided by sticking to the wording of the pertinent legislation and/or Regulation.

>>>Will you advise a municipality what to do if the owner attempts to redeem after the first deposit has been forfeited?
If the municipality is a Realtax client, yes we certainly will advise them.  We advise our clients every step of the way. 

>>>A lawyer who works for a municipality and who has conducted searches on properties would never sell the same searches (perhaps subsearched to update) to the public
And neither would we.  If a property is being advertised for tax sale today, then Realtax would have done a title search more than a year ago.  If someone ordered a search from OntarioTaxSales.ca today, OTS would conduct a search.  It would not use the search that Realtax used over a year ago.  If someone else ordered a search from OTS tomorrow, OTS would again conduct a search.  OTS only uses up-to-date searches.

>>>For example, if a Crown lien comes on after service of the final notice or even after the sale, but before registration of the tax deed
That Crown lien would show up on the search that OTS did, and we would report it to the person who bought that search.  But, we would have no way of knowing about the Crown lien if it were registered anytime after the OTS search was done. 

Jeff Oberman, President
OntarioTaxSales.ca
Realtax

[Ronster]

Thank you Jeff, and welcome to the forum.  I for one appreciate your informed responses, and as a newbie, am soaking up a lot of information... the more the better!  I see why others view it as a problem with the ease of getting involved with tax sales for newcomers such as I, but that is simply how it now is. 

[Dave2]

Here's a bit of a long post.  It addresses a number of issues that have been raised and comments that have been made.

>>>Anyone who has encountered what I will call "interesting dealings" with a small rural municipality knows what I am talking about

If there was no ots another similar company would be there and who knows, they might not have the integrity of OTS, maybe more.Quote = OTS Jeff>>>

Jeff:

My first comment was directed at the downside of not having a larger service provider like yourselves around.   At least you and your staff are fair and certainly professional in
in all the dealings that I have been personally exposed to.  I have strong suspicions that this may not have been always been the case in very occasional other tax sale situations that I have been involved in; when you or your staff was not involved, but the circumstances were not worth a major fight.  

One question I do ask is;  If myself or a member of this board wishes at any time to hire your organization for a consulting assignment that would not put you in a conflict of interest with your other clients is that possible?  

Finally I will leave everyone with a radical thought that I believe the members of this board might be better off if more bidders used Jeffs services (or the equivalent).  (Not all of us including myself  have the knowledge or resources of Frank or PFM).  Why because I think it would reduce the stupidity we have all seen.  

Using an analogy in My home country of Northumberland if I want to buy a building lot from a real estate agent; the standard phrase the real estate agents use is "Buyer to do his own due diligence."  

On another issue someone PMed me and asked the context my accountant was using when he said more then two sales HST applies because you are in the business of buying or selling land.   Was that annually or forever?  Technically he was refering forever but I recognize over a longer say 10 period someone can get 3 sales pretty easy by selling their house twice and buying a cottage.  I am not a tax expert but but also the circumstances are importantant.  With the amount of land I have bought, I pay HST period.

[netpred]

What is interesting is that no one including the pro's like Frank and PFM have questioned them about the one situation where I would be worried about them?  We have the opportunity now so my question for a coffee (Timmies I cannot afford the more expensive alternatives)  is what is it?  (I will also allow OTS Jeff to guess it as well if he wishes)


Well Dave, you got me too. I can't imagine that I have left any stone unturned. The only thing that I have not raised is the possibility of someone affiliated with OTS or Real Tax`bidding on tax sale properties. The reason that I have not raised this is because it would be an absolute defamation to suggest it without any evidence. I may not like OTS and Real Tax, but I have no doubt that they would never engage in this sort of underhanded self-dealing behaviour. From all accounts Jeff is the sort of person who I would like to take to dinner and have a fine conversation with - especially since he was willing to come here and address all of our issues and concerns (although I continue to have issues and concerns). So, I can't possibly imagine what I might have missed. Tell me, the suspense is killing me.