Proposal would help state keep banks from getting homeowner tax breaks
A reader wrote in the other day because she discovered that her former neighbor's house, foreclosed on several years ago, is still listed in public records as if he owns it and lives there. She wondered whether the foreclosing bank has been reaping property tax breaks all this time because the home is on the books as owner-occupied.
This is not an unusual problem. State officials say mortgage servicers are taking months, sometimes years, to take title to foreclosed property, leaving it in a sort of limbo that makes it difficult for neighbors and officials to determine who's actually responsible for the property.
But I don't think anyone knows just how many times this has happened -- or how much money local jurisdictions have lost as a result of Homestead Property Tax Credits doled out after the homeowner who qualified became a former homeowner. The state Department of Assessments and Taxation relies on title transfers to strip the credits from properties.
State Sen. Richard F. Colburn, an Eastern Shore Republican, tried last year to require deed recordation within 60 days after a foreclosure is ratified by the court, but the bill died in committee.
Now legislation before the Senate judicial proceedings committee would give the assessments agency another way to figure out which homes aren't homestead-eligible because they've been foreclosed on.