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City To Sell Liens To Recoup Back Taxes

October 22nd

tax lienBack taxes are troublesome for everyone involved. For debtors, wage garnishment and tax liens can result; causing even further financial trouble if the debts aren’t resolved. While the IRS has a low tolerance for tax debts, many other creditors are a little more flexible. However, one city is tired of playing nice and is looking to more serious consequences in order to collect on back taxes.

Collecting Debts

Pittsfield, MA reports being owed an estimated $3 million in back taxes. Dating back as far as 20 years, these uncollected debts are taking a toll on the city’s finances. Those who owe these taxes are being warned that the city will soon be outsourcing the collections to private firms and investors; who are likely to take serious action to collect.

City officials have notified owners of more than 300 properties that their home will become part of a tax title auction in early 2013. Winning bidders of the title auction will pay the full amount of the tax lien owed on the title and will, in turn, walk away with the right to pursue recovery efforts on delinquent property-tax payers. Property owners who fail to pay the private collector could lose their home faster than a lender-initiated foreclosure, less than 30 days in some cases. Property owners who do pay the private collector are likely to face up to 16% interest on their debt, also required to be repaid in order to protect their home.

 

 
 
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