UMass Law Professor Ralph Clifford was quoted in a WGBH article on home owners over-due tax liens resulting in home foreclosure.
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UMass Law Professor Ralph Clifford was quoted in a WGBH article on Massachusetts homeowners whose overdue tax liens lead to home foreclosures. Roughly three dozen Massachusetts cities and towns auction off tax lien debt to private investors, who often collect far more in fees and interest than the taxes originally owed. These tax lien auctions often begin a cycle of high interest rates and legal fees which puts the homeowner at risk of foreclosure.
WGBH spoke with Professor Clifford, who recently conducted a study on tax lien foreclosure cases by studying a random sample of tax lien foreclosure cases in the Massachusetts Land Court. The study found that more than 15% of home owners with tax lien troubles end up losing in tax lien foreclosure cases. Professor Clifford’s study also found that there was a $56 million profit paid to cities, towns and private investors in one year, which was based on the properties’ assessed value compared to the original tax lien debt.
“It’s an outrageous windfall for municipalities taking it. It's an outrageous windfall if a private entity is taking it, but the outrageous windfall is because the system is bad,” Professor Clifford said. “It's the law. The law is nuts.”
To read the WGBH article, please visit: https://www.wgbh.org/news/local-news/2019/01/21/some-cities-are-cashing-in-on-homeowners-tax-debts-and-making-foreclosure-more-likely
To read Professor Clifford's article, please visit: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3086247