Some homeowners could lose their home for as little as a few hundred dollars in unpaid taxes. And while this is a boon for investors it presents a new wave of crisis for the elderly and lower-income homeowners.
According to a new survey by the National Consumer Law Center, the elderly and those with cognitively challenges are losing their homes at an alarming rate and the center warns states to update their tax lien laws to stop a new foreclosure crisis.
Tax liens which are placed in properties with unpaid tax balances can be as little as a few hundred dollars and enables investors to come in and grab up these homes for very little. Many of the people affected by this crisis are unaware they are about to lose their homes or know they can challenge the seizure by employing a foreclosure lawyer.
The study’s author, John Rao, said, “Homeowners nationwide, particularly the elderly and people with cognitive challenges have lost or stand to lose family homes along with long-term equity which may represent their sole savings and security for retirement. Our report is a wake-up call for states to reform their tax sale laws to keep speculators from reaping huge windfalls at the expense of fragile citizens while ensuring local governments receive much needed tax revenue.”
A tax lien sale can be initiated for a small amount and investors can purchase a home for a fraction of its worth if the homeowner fails to buy back their home. The investors then make huge profits while these vulnerable citizens are left with a home.
Foreclosures are preventable but it often takes the expertise of a foreclosure attorney who can offer a variety of alternatives to bank repossession. These alternatives include a mortgage modification, short sale or bankruptcy.
Homeowners who want to stay in their homes can benefit from the help of a foreclosure attorney to challenge their lender or request mediation.