County Says Seizing Home Over $8.41 Tax Debt Was OK Because Counties Need Money

Discussion in 'The BS Topic' started by danbrennan, Nov 9, 2019.

  1. Lowend

    Lowend Administrator. .a car, a man, a maraca. Staff Member Lifetime Gold Member

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    I'm going to look into this further before coming to a solid opinion...

    I will say this. Michigan has a huge problem with abandoned properties. Rotting houses that were left sometimes decades ago.
    Back in the 1990's there were many small investors (just people, not real estate companies) that came in and bought dozens of properties for little to no money with the thought they would redevelop them. Unfortunately, the vast majority of these "investors" did nothing with the properties and left them to further rot.

    This guy could very well own many properties like this he's never paid taxes on and is blighting the neighborhood
     
  2. danbrennan

    danbrennan Veteran Member Lifetime Gold Member

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    "Paffendorf became increasingly interested in Michigan's unique tax foreclosure rules shortly after Detroit's 2013 bankruptcy, when his company worked with an anti-blight task force to identify and photograph abandoned properties across the city. At the time, the media was fascinated with Detroit's economic collapse—one of the most memorable signs of which were the homes being auctioned for $1,000 or less."

    "As he began tracking the supposedly vacant homes being auctioned off by the city, Paffendorf noticed an odd trend: Lots of them weren't actually vacant."

    ""There was sort of an assumption that tax foreclosures were happening to abandoned buildings. You know, properties that people had left," he tells Reason. But that wasn't always the case. "We saw thousands of properties that had people living in them being auctioned.""
     
  3. Earlsfat

    Earlsfat Veteran Member Lifetime Gold Member

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    Whut?
    I'd be interested in knowing who is acquiring the properties when the municipalities auction them off for 10-20% of FMV. IMHO any buyer even remotely related, or even known, to anyone in that municipality's government, they should undo the sale, charge the entire board personally 200% of the FMV of the property and write off any outstanding debt that predicated the sale.
     
  4. Da-bigguy

    Da-bigguy Veteran Member Lifetime Gold Member

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    I know there are a large group of 'investors' who go to those sorts of auctions in the hope of picking up properties for pennies on the dollar. I've even attended a couple real estate auctions on the steps of the local court house in Houston, as part of research into real estate investing.

    I would never knowingly bid on a property that was being sold due to HOA fees being unpaid. Of the two investment properties I've bought, one was a short sale before the owner went into foreclosure and the other was a property, same street as the first, that had been taken back by the bank already and they were trying to get it off their books. On that one, I made an offer of what I could afford and about a month later, the bank came back asking if I could increase my offer. I pretty much ignored that and a week later, they accepted my original offer so that worked out well for me. The first one, because it was a short sale, the owners mortgage holder had to agree to the price which they did so I got it free and clear as well.
     
  5. ol' grouch

    ol' grouch Veteran Member

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    Locally there are sales of property cheap but it's usually with very old buildings that need to be razed. Quite often the transfer fees and such cost more than the property. I've been tempted a couple of times but considering the neighborhood, I passed.
     
  6. xten

    xten Veteran Member

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    Probably not often, but sometimes a complete lack of communication, and apparently no desire to fix it. Last Thursday a customer was telling me his problem with the county. Bought a nice house in a good neighborhood. Taxes included in mortgage. They reassessed the property to the purchase price, which was higher than the original assessment at time of purchase. Over the last two years his mortgage has increased over $300 per month, and it still wasn't enough to cover taxes. He went on county's website last week and found out his tax payments have been short $166 per year for the last two years. Nobody told him, so I guess it was his responsibility to find out, or lose his home.
     

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