‘An Act To Protect Homeowners Affected by Tax Lien Foreclosure’
HP1124 LD 1629 |
Session - 128th Maine Legislature C "A", Filing Number H-771, Sponsored by
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LR 2290 Item 5 |
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Bill Tracking, Additional Documents | Chamber Status |
Amend the bill by striking out the title and substituting the following:
‘An Act To Protect Homeowners Affected by Tax Lien Foreclosure’
Amend the bill by striking out everything after the enacting clause and before the summary and inserting the following:
‘Sec. 1. 36 MRSA §942, as amended by PL 2009, c. 489, §§2 and 3, is further amended by inserting after the 4th paragraph a new paragraph to read:
Within 30 days after recording a tax lien certificate in the registry of deeds for property that constitutes a homestead for which a property tax exemption is claimed under subchapter 4-B, the municipal treasurer shall provide written notice to the person named on the tax lien mortgage that that person may be eligible to file an application for tax abatement under section 841, subsection 2, indicating that the municipality, upon request, will assist the person in requesting an abatement and provide information regarding the procedures for making such a request. The notice must also indicate that the person may seek assistance from the Department of Professional and Financial Regulation, Bureau of Consumer Credit Protection regarding options for finding an advisor who can help the person work with the municipality to avoid tax lien foreclosure and provide information regarding ways to contact the bureau. The Department of Professional and Financial Regulation, Bureau of Consumer Credit Protection, by July 15th annually, shall provide to a statewide organization representing municipalities information regarding assistance in avoiding tax lien foreclosure to assist municipalities in providing the information required in the notice.
Sec. 2. 36 MRSA §943-C is enacted to read:
§ 943-C. Sale of homesteads formerly owned by persons 65 years of age or older
Notwithstanding any provision of law to the contrary, after the foreclosure process under sections 942 and 943 or sections 1281 and 1282 is completed and the right of redemption has expired, if a municipality chooses to sell property that immediately prior to foreclosure was eligible for a property tax exemption as a homestead under subchapter 4-B, the municipality shall notify the former owner or owners of the right to require the municipality to use the sale process under subsection 3 if the former owner or owners demonstrate that the property meets the requirements of subsection 1.
(1) The income, as defined in section 5219-KK, subsection 1, paragraph D, of residents of the property was less than $40,000 for the calendar year immediately preceding the calendar year in which the right of redemption expired; and
(2) The value of liquid assets of the residents of the property is less than $50,000 in the case of a single individual or $75,000 in the case of 2 or more individuals. For the purposes of this subparagraph, "liquid assets" means something of value available to an individual that can be converted to cash in 3 months or less and includes bank accounts, certificates of deposit, money market or mutual funds, life insurance policies, stocks and bonds, lump-sum payments and inheritances and funds from a home equity conversion mortgage that are in the individual's possession whether they are in cash or have been converted to another form.
(1) The sum of tax owed;
(2) Property taxes that would have been due on the property during the period following foreclosure when the property is owned by the municipality;
(3) Interest;
(4) Fees, including real estate broker's fees; and
(5) Any other expenses incurred by the municipality in making the sale or maintaining the property.
Sec. 3. 36 MRSA §1281, as amended by PL 1991, c. 846, §12, is further amended by inserting at the end a new paragraph to read:
Within 30 days after recording a tax lien certificate in the registry of deeds for property that constitutes a homestead for which a property tax exemption is claimed under chapter 105, subchapter 4-B, the State Tax Assessor shall provide written notice to the owner named on the tax lien mortgage that that owner may be eligible to file an application for tax abatement under section 841, subsection 2, indicating that the State Tax Assessor, upon request, will assist the owner in requesting an abatement and provide information regarding the procedures for making such a request. The notice must also indicate that the owner may seek assistance from the Department of Professional and Financial Regulation, Bureau of Consumer Credit Protection regarding options for finding an advisor who can help the owner work with the State Tax Assessor to avoid tax lien foreclosure and provide information regarding ways to contact the bureau. The Department of Professional and Financial Regulation, Bureau of Consumer Credit Protection, by July 15th annually, shall provide to a statewide organization representing municipalities and to the State Tax Assessor information regarding assistance in avoiding tax lien foreclosure to assist municipalities and the State Tax Assessor in providing the information required in the notice.
Sec. 4. Appropriations and allocations. The following appropriations and allocations are made.
ADMINISTRATIVE AND FINANCIAL SERVICES, DEPARTMENT OF
Revenue Services, Bureau of 0002
Initiative: Provides funding to reimburse municipalities for 90% of the cost of selling property that has been acquired through tax lien foreclosure.
GENERAL FUND | 2017-18 | 2018-19 |
All Other
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$0 | $825,255 |
GENERAL FUND TOTAL | $0 | $825,255 |
SUMMARY
This amendment replaces the bill and requires a municipal treasurer or the State Tax Assessor, with regard to property in the unorganized territory, within 30 days after recording a tax lien certificate in the registry of deeds to notify the person named on a tax lien mortgage of the right to apply for an abatement and the availability of assistance in applying for an abatement from the municipal treasurer or the State Tax Assessor. The amendment also requires that the notification include information about the availability of assistance to avoid tax lien foreclosure from the Department of Professional and Financial Regulation, Bureau of Consumer Credit Protection.
The amendment also provides a process that must be used by municipalities that choose to sell property that has been acquired through tax lien foreclosure if the property was formerly eligible for a homestead exemption and was owned by a person who was 65 years of age or older and meets income and assets guidelines. Under this process the municipality must use an independent real estate broker, sell the property for fair market value or the price at which the independent broker thinks the property will sell within 6 months and return the net proceeds of the sale to the former owner after deduction of the municipality's costs.
The amendment also provides funding to municipalities to cover state-mandated costs.