Property tax drama!

[dadof3]

hello everyone, been a longtime since i last posted so just a quick update i filed chapter 13 in 2007 jan and i live in Michigan , included 2 cars and 2 homes in filling.. in 2010 i surrended my home and moved out , now state of michigan is trying to charge me for property taxes for year 2011 under something called michigan priimary homestead exemption. I called the state and they are advising that the sheriffs never removed my name from title until recently and i may be on the hook for the year i was not there? Has this happend to anyone else? would my chapter 13 protect me from this? sorry so many questions, lawyer will not respond anymore!

[HHM]

Property tax is connected to the land. Who ever owns the land is liable for the prop tax until there is a valid transfer. So, for example, if you filed chapter 13 in 2007, but the bank did not foreclose until 2009 (the valid transfer), the homeowner is on the hook for property taxes for 2008 and 2009 and can make collection attempts during that time. Those are post petition (post filing) debts. Sorry. However, once the house is foreclosed, ALL property taxes become the problem of the bank.

Surrendering a house in BK is not a transfer, it is merely a statement of intent. The mortgage holder still needs to foreclose (or you need to sell it) to actually transfer ownership.

[tobee43]

i'm gathering your taxes were not included with an escrow account in your mortgage payment??

if they were, the bank would have continued to pay them since they most likely or at least most banks are not willing to let a house go at a tax sale.

i am somewhat confused here, didn't you list your property taxes on your petition?

i understand hhm's argument about the fact that the bank did not transfer you names off the deed, since that ONLY happens when the property owners name changes and the sale transfers, even if it's to the bank. and, what? since many status of limitations in many states are century or two, for a forced hand at deed transfers, what? you think in 20 years you'd owe back taxes after the house has been in the hands of the bank? doubtful.

i would fight this in court and i'm hard press to think you would not win if you surrendered your house.

while i understand all that is said and spoken in theory about the house is still yours until the deed transfers, i would say if your surrendered the house and it's been in the banks possession they should have paid the taxes not you. again, i understand and have mentioned this on numerous occasions, while it may be a technicality having your names on that deed, for whatever reason, the bank is holding the property, or whatever, technicalities win cases as well as lose them. i would fight it to the end!

[markinva]

HHM: Thank you for explaining this is simple terms - exactly what's been on my mind. In my case, I am surrendering a house in March 2012. Property taxes are 6K per year. I no longer make payments on the house so no funds are no longer going into escrow for tax and insurance. At Trustee's request, I have to file new schedules I and J at my continued 341 meeting in March. Given potential for my prop tax (and insurance and HOA fee) liability until the deed is actually transferred to some other party, I'm thinking that I need to make sure that prop tax, insurance, and HOA expenses for the surrendered house are included in my schedules?

[tobee43]

oh, i thought for some reason you had already surrendered your house and moved out as per what you wrote?

in 2010 i surrended my home and moved out

but now you're saying :

In my case, I am surrendering a house in March 2012.

which is it?? are you still in the house now? or is this another property?? it's not very clear?

[ValleYum]

oh, i thought for some reason you had already surrendered your house and moved out as per what you wrote?


but now you're saying :



which is it?? are you still in the house now? or is this another property?? it's not very clear?

Psssst: 2 different posters.

[tobee43]

OMG!!! do i need more coffee or what...okay, a bit of what might help? you think??

i'm really confused!! LOL!!!!!!!!!! i'm so glad you got my back Valle

[etechjc]

I owed 2 years back taxes, County kept billing me to point they were going to sell the house. Once that tax sale notice went out in the papers, My bank finally stepped up and payed the taxes. May even have been what convinced the bank to finally foreclose. Of course in my case 2 years of taxes only equaled $1900 after late fees. Haven't heard word one from anyone since. Nothing ever showed up on my CR.

[HHM]

I owed 2 years back taxes, County kept billing me to point they were going to sell the house. Once that tax sale notice went out in the papers, My bank finally stepped up and payed the taxes. May even have been what convinced the bank to finally foreclose. Of course in my case 2 years of taxes only equaled $1900 after late fees. Haven't heard word one from anyone since. Nothing ever showed up on my CR.

Yep, that is common. Generally, the 1st mortgage will be notified by the taxing authority when a property tax lien is imminent. That usually wakes them up, they will pay it, or otherwise foreclose.