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Left with Nothing

washingtonpost.com

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Re: Left with Nothing

#41

Post by larrys »

scotty79 wrote: post #14
chiph wrote: post #5

Obscure program?? It happened all the time in the 1930's. If you couldn't pay your tax bill, your property was auctioned off on the courthouse steps.

Via private company operating for profit?

Issue is abuse of that system not the fact that it was by a private company operating for profit. Many prisons are run by for profit enterprises as well as hospitals. The way the program is run is the important thing not the type of enterprise handling the program.

Example: Small town with "speed trap" (not a for profit business) gives out excess tickets to raise money.

Re: Left with Nothing

#42

Post by citricsquid »

larrys wrote: post #40
citricsquid wrote: post #17

Earlier quoted context omitted.

The article talks about the real problem: fundamentally you're right, these people should have paid their bills, the problem is they're not given an opportunity to properly make up for their mistakes and the "punishment" does not fit the "crime". After the bill isn't paid the lien is sold to investors who increase the owed amount by an order of magnitude (so that the person really can't pay it now) and drag them thro…

"After the bill isn't paid the lien is sold to investors who increase the owed amount by an order of magnitude " What is the time period that that happens though? Isn't that an important factor in all of this? Plays out over years? How many chances (and over what time period) could the homeowner have been able to rectify for a more reasonable amount of money? Not disagreeing with your main point or that the punishmen…

The article states that the investor can foreclose on the house 6 months after purchasing the debt. Skip to "Outsiders come to buy liens" in the article for a full summary of why it's such a problem.

Re: Left with Nothing

#43

Post by redsymbol »

mpalme wrote: post #18

Meta note: this is what journalism can look like today. Made for the web first, not for the paper. Visualizations that are actually insightful - and most importantly a well researched story.

Absolutely - I noticed that too. Exceptionally well done from a web publishing standpoint.

Re: Left with Nothing

#45

Post by harrytuttle »

bsullivan01 wrote: post #34
harrytuttle wrote: post #30

Earlier quoted context omitted.

As an English atheist, possibly surprisingly, I think Islam is right regarding interest. Unfortunately wrapping it up in mumbo jumbo doesn't give it any credibility. Also it isn't really related to the article.

At least inflation has to be added, and that's without calculating any risk. Otherwise I'll borrow from you $100K and return it 30 years later

Not really.

a) growth isn't required in all economic models so inflation isn't necessarily valid.

b) goods and services are perfectly good interest. Not that you'd have to borrow it if interest wasn't profitable (it would drive asset value down).

c) risk is irrelevant if lending isn't required.

you're too in the bank and growth model mindset. It doesn't work like that everywhere.

Re: Left with Nothing

#46

Post by ok_craig »

brianmcconnell wrote: post #26
dantheman wrote: post #21

Earlier quoted context omitted.

Why would an Ayn Rand acolyte support the state taking the property of private individuals?

I was referring to the generally sociopathic attitude they tend to adopt toward The Poor. BTW, this is a privatized operation wherein predatory debt collectors buy the liens, foreclose the property, and then flip it at a huge profit. Just another example of government acting as stenographer for the financial industry.

You really have no idea what you're talking about.

Re: Left with Nothing

#48

Post by aheilbut »

acchow wrote: post #10

Can someone point me to the laws and regulations that allow this? Someone who owns their home completely (with no mortgage) can lose the entirety of the home due to unpaid taxes? Even if the value of the home far exceeds the tax debt? This is mindboggling to me.

What is also crazy about it is that the government is apparently not setting a high enough price for the liens. If they correctly priced the 'option' that the lien wouldn't be paid and the buyer could foreclose, then it wouldn't be so attractive for the predatory buyers. So the government is allowing itself to get ripped off too.

Re: Left with Nothing

#49

Post by alistairSH »

larrys wrote: post #37
cromwellian wrote: post #15

Earlier quoted context omitted.

The problem is, privatizing a state function -- collecting property taxes -- into a profitable enterprise. Ok, the guy owed $134, explain how under any reasonable financial theory, how this should be worth $5000 or $197,000. Why not a lien against his military pension? Why not negotiate a payment plan? Even the IRS has the courtesy to do that. Let's take the best possible return, say 20% annual return, and let's say…

Good points and agree. But I think when you get into "at best he'd owe $848" then you don't provide proper disincentive to prevent the behavior of ignoring tax bills and other notices. As an aside as someone who has gone through significant pain trying to collect money from people that owe varying amounts (over the years) it's a process that given a bigger stick (not "ordinary" penalties) would go a long way. Noting…

"Noting also that this played out over many years."

Not so. The article states the liens can be sold after a year and foreclosure initiated after an additional 6 months. In several of the cases listed, the original home owner was in hospice care or otherwise unavailable.

I don't disagree that the city needs a way to recoup unpaid taxes. But, there has to be a better way than this.

Re: Left with Nothing

#50

Post by ars »

afterburner wrote: post #31

The logical outcome of this kind of predatory practice should be that the "investor" (the purchaser of the liens) gets $5000 out of the $197,000 sale, and the debtor gets $192,000. And even that seem predatory, never mind getting all the equity and forcing the person out of their place of residence.

That's the law everywhere I've ever checked. Very very odd if it's not the case in D.C.
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