Some of our investment knowledge of California has been talked about in previous entries, but I want to go over some of the things that are specific to California once more.  California is a tax deed state and when an investor purchases tax deeds at the auction there, the investor should do all of his or her due diligence so that the investor knows exactly what he or she is buying. Once the investor has purchased the property, which goes to the highest bidder, it completely belongs to the investor.   California, like Arkansas, has a litigation period of one year.  That means that the previous owner has the time frame of one year to contest the sale of the property sold at the tax deed auction.  In California they are referred to as tax defaulted properties.  Because of the litigation period, which is offered to the previous owner, it is recommended that you don't do any remodeling or sales of the property until this time frame is up.  If it happens that the owner does win in court, the county made a mistake, and the property was not truly a tax defaulted property, then the person who has invested in that property will still receive 6% interest on his or her investment.  This way the person who invested in the property would not be out completely on his or her time and money that was put into the property. Doing enough research on a person and property can give you a better assurance of the time frame, if any, that would be involved for the litigation period.  In other words if you find out that the owner is truly delinquent on a property then you would be safer going forward with the property and not worrying about the litigation period. California can be a very lucrative state.  Being a tax deed state requires more initial investment capital, yet it can make you much higher returns on the rebound.