Greenfield Recorder – “Home equity theft” bill passed by House

Greenfield Recorder – “Home equity theft” bill passed by House

BOSTON – The House of Representatives voted unanimously Wednesday to approve a bill that, if signed into law, would ban a practice commonly known as “home equity theft,” or the government’s taking and reselling of foreclosed properties of taxes without compensating the owner for excess profit.

Originally filed by state Reps. Tommy Vitolo, D-Brookline, Jeff Roy, D-Franklin, John Mahoney, D-Worcester, and Tram Nguyen, D-Andover, the legislation prohibits municipalities and private companies from keeping excess equity in the event of . of forced execution of the fiscal right. The unanimous vote came about a month after the state Senate passed an amendment to its spending package in May that also bans the practice.

“One of the words we heard a lot when considering this legislation in Parliament was the idea of ​​fairness. We heard en masse yesterday that this process was inherently unfair to property owners here in Massachusetts, and we needed to protect the rights of those property owners throughout the tax lien enforcement process,” said Rep. Natalie Blais, D-Deerfield , in an interview on Thursday.

Although both pieces of legislation address the same issue, the Senate bill caps the interest rate on delinquent property taxes at 8 percent, while the House set the interest rate at 16 percent. In addition, the recently passed House bill sets a statute of limitations for prior stock takeovers at one year — a limit that some, like Greenfield resident Al Norman, see as too narrow.

“The equity bill passed in the House today closes the door on people who had their equity stolen by a city or town before the day SCOTUS ruled it unconstitutional,” Norman, who previously joined other Greenfield residents , Joan Marie Jackson and Mitchell. Speight is testifying on capital theft legislation, he wrote in a statement. The U.S. Supreme Court ruled the practice unconstitutional last year in Tyler v. Hennepin County, Minn.

“It’s only a one-year statute of limitations,” Norman continued. “It’s like telling a bank robber, ‘You robbed that bank, but since it was over a year ago, you can keep the money.’

Rep. Belchertown Rep. Aaron Saunders, in an interview Thursday, said he expects both the legislation’s statute of limitations and the tax interest rate to be reconsidered during future conference committee meetings.

“In the commission that is to be established to further investigate the matter, one of the issues, among those that will be examined is the interest rate to understand what is the right rate to provide the necessary incentive for homeowners to do the tax. payments are a priority and effectively not discourage payments because of market rates,” Saunders said. “We need homeowners to have all property rights available to them. Especially for those facing a tax foreclosure, making sure the clock doesn’t run out on being able to exercise the rights they would have after a year, that they can still exercise the same rights until they’re 70, is as important as ensuring that these rights are available to homeowners.”

Passage of either the Senate or the residential burglary legislation would bring the state into compliance with the U.S. Supreme Court’s ruling in Tyler v. Hennepin County, Minnesota. In addition, Hampden County Superior Court Judge Michael Callan ruled on April 18 that the excess equity taking under Massachusetts state law violated Article 10 of the Massachusetts Bill of Rights and the Fifth Amendment to the US Constitution.

Anthony Cammalleri can be reached at [email protected] or 413-930-4429.