Homeowner lost her paid off house for $2600 in unpaid property taxes

A recent article on MassLive details the saga of a Worcester homeowner who  paid off her home's mortgage in 2015 (after only 19 years) and in 2019 missed one property tax payment. She didn't realize she'd missed the payment and kept paying her taxes normally. Then one day she found that the home had been sold through a foreclosure tax sale to a private lien harvesting company, Tallage, which paid about $20,000 for the house.These companies that buy homes in tax foreclosure love to find houses with no mortgage, as they resell and make a huge profit without having to pay the bank.The Worcester homeowner is fighting the taking and a recent US Supreme Court ruling makes it likely that she will get to keep her home and not owe Tallage the $70,000 they're asking her to pay to get ownership back.Read the whole article here: She lost her home over a tax bill

Supreme Court ruling protects homeowners in foreclosure

Some states, including Massachusetts, allowed municipalities to profit on foreclosure sales by keeping whatever equity was in homes seized in foreclosure. Say a homeowner owed $20,000 in property taxes and the town took the property in a foreclosure and sold it for $120,000. The town would get its $20,000 in unpaid taxes, but if the homeowner had paid $80,000 worth of the mortgage, i.e. had $80,000 of equity in the home, towns in Massachusetts would take that equity.A new (and unanimous) US Supreme Court ruling made that practice illegal. The ruling was on a case in Minnesota, but it applies to all states, including Mass, that keep those surplus proceeds beyond the overdue taxes. A recent study by the Pacific Legal Foundation found that "on average, Massachusetts homeowners subjected to a tax foreclosure lost 87% of their home equity, almost $260,000 per home and the average tax det owed was $36,000."Springfield had the most tax sale properties (129) between 2014 and 2020 and Wareham kept the most equity ($554,597) during that time period. Tallage is a company that handles tax sales for many municipalities and it is often they who keep the proceeds, as this chart shows:There are two bills before the Mass Legislature proposing an end to the practice of equity taking, but they may be moot due to the SCOTUS ruling. Read the whole Boston Globe article here.