A U.S Supreme Court decision ruled that property tax sales that deprive homeowners od equity are uhconstitutional.
The way the system works now is when taxpayers have delinquent taxes, the County Treasurer collects by holding an auction.
Prospective buyers bid on the interest they will charge the homeowner to redeem or pay off, starting at 12% for every six months (or 24% per year).
Certainly usurious.
When I was conducting such auctions, there was little competition…with most sales requiring the maximum rate of 12% per half year.
If the homeowner doesn’t pay the taxes and interest to the tax buyer, that person can file legal papers to take possession of the property.
Almost always the property is worth more than the amount of the real estate taxes the tax buyer has paid.
Usually, that results in the homeowner’s losing the part of the mortgage they have paid off, minus the unpaid taxes.
The Federal case before U.S. District Judge Matthew Kennelly has lingered on as the Illinois General Assembly has done nothing.
All other states with a similar system have passed remedial legislation.
In the decision, the Judge held Cook County responsible for paying the lost equity.
Cook County Treasurer Maria Pappas was a defendant in the case.
In Cook County unpaid taxes sold at tax sales sine 2019 was $2.3 million, but the homes had a total market value of more than $108 million.
The bill: $105.7 million.
As you can see in one of the articles I have written on the subject, McHenry County taxpayers could be on the hook for $13 milliion.
Below are the articles I have written on the subject in chronical order:
