12 States Allow Home Equity ‘Theft’ Over Homeowners’ Tax Payment Shortfalls, Study Says
28th December 2022
Twelve states and the District of Columbia allow local governments and private investors to seize dramatically more than what is owed from homeowners who fall behind on property tax payments, according to a new report.
The practice, which Pacific Legal Foundation (PLF) calls “home equity theft,” is documented in what the organization bills as the first national study aimed at exposing “the injustice of home equity theft through tax foreclosure.”
Homeowners lost more than $777 million in life savings on more than 5,600 homes, based on their market value, in transactions that took place from 2014 to 2021. The true total is probably higher because statistics from New York state and some statistics from the other states studied were not available. On average, homeowners lost 86 percent of their equity, the study found.
Government entities, which often unload properties for a fraction of their market value, collected an estimated $26 million more than they were owed on about 1,300 homes. At the same time, private investors, who purchase tax liens, took in about $250 million more than what they were owed on about 2,600 homes.
When it is possible to steal other people’s money through the political process, it will be done. Nothing is more common than politicians and parasites coordinating theft under pretext of law.