Real Estate Taxes and Foreclosure

[filingin08]

We filed Chapter 13 in 2008 and at the time did not surrender our home.

About a year ago, both DH and I took jobs in a different city and had to move, leaving our house vacant.

We tried working with the bank on a DIL, but a real estate lien has been placed on the property that we cannot satisfy, so the bank will not work with us and moved to foreclose.

When bank moved to foreclose, we petitioned the court to allow us to modify our bk and surrender. There were no objections and the motion was approved. The motion states the creditor has 30 days to enter an actual claim.

Will we be responsible for real estate taxes between 2008 filing and 2013 modification?

My true hope is the county moves to foreclose and forces the bank to get it done, but my thinking may be off.

We're months from fininshing our 13, and then we could begin to satisfy the real estate taxes and move forward with DIL. Although, I'm leary of this as I've heard DILs are still no guaranteed thing.

Any advice? Suggestions? We are in Ohio and our mortgage holder is Ocwen if that matters.

Thanks.

[justbroke]

You will not be responsible for real estate taxes. That is a type of tax that "runs with the land". In almost every jurisdiction that I have read, real estate taxes are either sold as "tax deeds" (redeemable after a period of time) or the property is auctioned for the taxes. Either way, it is typically a foreclosure that settles a tax deficiency.

And yes, DILs are rare but it does happen from time to time (with clean title). I would just let the tax "problem" take care of itself. it could take some time based on how your municipality deals with delinquent taxes. (In Florida, past due taxes are sold as "tax certificates" (basically an investor pays the taxes for a certificate). After 2 years, in Florida, the tax certificate holder can apply for a tax deed and then proceed to foreclosure if the tax certificate is not satisfied/paid.) I believe that Rhode Island is similar. I do not know how it works in other States.

[filingin08]

Thanks. I looked at the auditor's website yesterday and it appears our taxes are now current, but when I looked at the recent sales (of outstanding taxes), our address was not listed, so I called, and was told there is not a tax lien on the property. I cannot for the life of me figure out why Ocwen would prefer to do a foreclosure (more cost to them, I thought) than just let us sign over title. I so wish we would have surrendered when we first filed and then this would be done. Ah well, live and learn (although I plan to never be in this situation again!).

[justbroke]

No one understands! Sometimes, a foreclosure is the best way to insure a clean title.