What I’m wondering is what about the taxes? If the property is still listed in the homeowner’s name, and the bank hasn’t foreclosed, doesn’t that mean taxes are accruing? Will the homeowner still be liable for the taxes? Eventually, seems the government would own the home because of back taxes that were not paid by bank or homeowner. If somebody gets hurt on that property and there’s no insurance, can the homeowner be sued?
Sued for what? They don’t have any money.
Good question. I would think that if the owner walks away from the mortgage, the lender has the right to foreclose and take title and then become the owner. However if the lender doesn’t take title and through the courts tries to sell the house at auction and fails, wouldn’t the lender have to take title anyway? And regardless if either the previous owner/borrower or the subsequent owner/lender through foreclosure do not pay the real estate taxes, then the taxing authority has the right to put the house up for tax auction, however if no one bids, then I would think the taxing authority gets the title. Confusing, I think. The base root of the problem is that there is no market to purchase these homes; they’re “hot potatoes” and until markets stabilize, credit comes back, and the economy comes back, then maybe they’ll sell. Remember one thing though, in the end if the property ends up back in the tax authorities hands, no one is paying taxes on it, and therefore unless their budgets have been slashed, their coming after those who pay their real estate taxes for the shortfall, hell or highwater, and that is you and I.