Property tax foreclosures come in record numbers
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JANESVILLE — Drop a pebble into a pond, and the ripples spread.
Drop a meteor-sized boulder into the pond, and the shape of the pond changes.
In 2008, Rock County suffered a meteor-sized economic hit: The housing market collapsed, the stock market took a dive—taking the national economy with it—and General Motors announced it would mothball the local plant.
Four years later, the impact of that meteor is showing up at the Rock County Treasurer's Office. Property tax foreclosures are setting records.
This spring, 288 properties entered the tax foreclosure process. That's up nearly 300 percent from 2008, when 76 property owners went through the same process.
Here's another change: This year, 122 parcels are plots in unfinished subdivisions.
Past due
Mortgage foreclosures—homeowners losing their properties because of missed mortgage payments—began flooding the local real estate market a few months after the first strike. But tax foreclosures—people losing properties for not paying property taxes—is a delayed reaction to the recession that started in 2008.
The tax foreclosure process takes a considerable amount of time as dictated by state statutes and county ordinances.
For example, the last installment of the 2008 property taxes was due July 31, 2009. Tax liens were placed on properties with unpaid taxes on Sept. 1 of that year and remain on the property for two years by state statute. Rock County starts foreclosure after taxes go unpaid for two years and six months.
Not all the properties that go into the process end up being foreclosed. In 2011, the county filed on 80 homes and foreclosed on 56.
On March 1, the foreclosure process begins in earnest and the county will take ownership of the properties sometime in the first full week of September.
Making the sale
Every August, the county board finance committee tours the tax delinquent properties and sets the base bid price for each.
"Last year, we didn't get finished until the evening," Rock County Treasurer Vicki Brown said. "I don't know how we'll do it this year."
Here's something that might make it easier: This year, almost half of the properties are parcels in subdivisions.
Three Janesville subdivisions—Sunset Meadows, Quail Ridge and Greenway Point—have multiple parcels going through the foreclosure process. Additional parcels are in a former Lockhart Builders' subdivision in Beloit.
Owners of subdivision parcels include:
-- Blackhawk Community Credit Union, 13 parcels
-- Geraldine G. McCluskey, seven parcels.
-- Michael and Milissa Rick, Janesville, 22 parcels.
-- Sunset Meadow Development, 33 parcels.
-- Wright Family LLC, 23 parcels.
-- Town of Beloit, 24 parcels.
The county can only take possession of the property; it cannot go after any other personal or business assets.
Pay now, later or not at all
The town of Beloit acquired its parcels through a quit claim deed from Lockhart Builders, according to Town Chairman Roy Pavlik.
"They defaulted on required payments to the town," said Pavlik.
A municipality might put in streets, curbs and streetlights for a development, and the developer would pay back the municipality as lots and homes are sold.
If they don't sell, the municipality is on the hook for the costs.
It has put the town in a tough spot, Pavlik said.
"It's what we've been struggling with—whether to pay the taxes or let the them (the properties) go." Pavlik said. "We're trying to look at it in a practical way. We already own more property than we need—more than any government needs."
The town of Beloit also owns the Heron Bay subdivision and has been trying to sell those lots, as well.
The town is considering paying the back taxes on the Lockhart parcels and then selling them at a loss.
But at how much of a loss? And where will the burden of that loss fall, on the whole county or on residents of Beloit Township?
Picking up the slack
When a property owner pays taxes, the money is sent to the county and then divided among the taxing jurisdictions. For example, Janesville residents' taxes go first to the county and then are divided up among the school district, Blackhawk Technical College, the county, the city and the state.
In August, the county distributes the money to the taxing jurisdictions after "buying out" the tax rolls. That means if the taxes haven't been paid, the county makes up the difference.
For the 2008 taxes, the difference was $218,000. In 2009, $1.2 million went unpaid, and in 2010 it was $2.9 million.
At the same time, the county expects to make $2.14 million in 2012 for interest and penalties on delinquent taxes in 2012, according to Rock County's budget document.
For sale
Ironically, the municipalities where the properties are located have first dibs on properties in tax foreclosure. To take ownership, the municipality must pay all taxes owed, not just those owed on the first delinquent year. For 2012, that would mean paying 2008-2011 taxes.
Municipalities might buy the parcels to reduce blight or for development.
The county board finance committee might have a tougher job when it makes the August tour of foreclosure properties and sets base bids for the property auction.
"In the past, the finance committee tried to make the county whole," Brown said. "In this economy, they're not always able to do that."
Rock County Board Supervisor Sandra Kraft has served on the finance committee for 12 years.
"It's not impossible to do, but there are some properties we'll be lucky to be able to sell," Kraft said.
Plenty of properties have sold for less than $1,000 she said.
"The goal is to get the properties cared for again, to get them back on the tax rolls," Kraft said. "We can't just hang on to them."
May 16, 2012 at 3:32 p.m.
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This is so shocking! According to the "new numbers" - employment is way up! How can people possibly be losing their homes in our great economy? [/sarcasm]
May 16, 2012 at 3:20 p.m.
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Mouse - What game would that be Mouse? Calling your constant hypocritical behavior out? Having my own thoughts that aren't completely slanted one way? Using common sense when posting and debating? According to you, the economy just recently collapsed. According to you, the last four to five years, things have been great. You don't have a leg to stand on with a debate when that's what you actually are so naive to believe.
May 16, 2012 at 2:16 p.m.
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Mouse - Again, we are talking about you here. Swoop on bloggers I don't agree with? No Mouse. I have intelligent debates with those folks. You on the other hand, different story. You aren't capable of debating. You simply don't know how. Instead you continue to literally attack everyone on this website with your little riddles. No wonder why we have foreclosures and people with financial problems? Again, we're you just born? You think foreclosures and financial problems just showed up? You continue to prove how out of touch you are with reality Mouse. You will continue to blame one individual for everything without excepting any responsibility of the past and the effects it has had.
May 16, 2012 at 2:07 p.m.
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THANKS MR. DOYLE; THANKS A LOT!!!
HOPE YOU ARE ENJOYING YOUR LIFE!!
**
DID YOU SIGN THE RECALL PAPERS??
May 16, 2012 at 11:49 a.m.
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Mouse -Why don't you ask all of them. They are their own posters. I have one name and you have been busted numerous times responding on here under another name to a post. Give it up Mouse. You have been put on the spot again. I cannot believe the Gazette still allows your garbage and games on here.
May 16, 2012 at 10:35 a.m.
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Mouse - How many screen names do you actually have?
May 16, 2012 at 10:33 a.m.
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Mr Mouse you r so rightr. The rich are just thiefes who are steelering from us middleclasses peopoles just like ed shultzs says. I lik him 2.
May 16, 2012 at 10:32 a.m.
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Thank you to George W. Bush, his greedy cohorts, Bank of America - the greediest bank of all, and all Republicans for this mess. Wake up, right-wingers, you are misplacing the blame.
May 16, 2012 at 10:02 a.m.
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Mouse - Oh, now you are going to deny your posts on the gas story? Below is the start of many with regards to Walker on that subject.
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Mouse
May 15, 2012 at 9:40 a.m.
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This story sounds like a Walker commercial gone bad...... style gas.
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Yes this story is about foreclosures, so you blaming Walker for this problem that has existed for years, is like blaming him for gas. So try and stay on topic.
May 16, 2012 at 9:20 a.m.
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This is what the farmers union wanted back in the year 2000 and the rest of us are suffering because they don't pay their fair share.
May 16, 2012 at 9:19 a.m.
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Mouse - Just the response I expected. I am not talking about Walker. I am talking about you and the constant hate you have on this website. Your life is a constant blame game. I think it's physically impossible for you to post anything positive, regardless of the subject. I mean, you blamed our Government for a gas station personally screwing up the gas prices. Give me a break!
May 16, 2012 at 9:12 a.m.
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916: What on earth are you talking about. Tippin back on some of grandpa's cough medicine this morning?? I'm not talking about who is to blame for anything. I'm calling you a hypocrite because just the other day you blasted someone for using a 'pathetic stereotype' in regards to you, but then you have no problem calling all liberals 'lazy' or saying 'Typical liberal, always unable to take responsibility for anything'. When others use them it's pathetic. I'm not surprised that this would come as a surprise, but yours is equally as pathetic.
May 16, 2012 at 9:01 a.m.
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Mouse - You sit on here daily and attack every poster on here. It doesn't matter who it is. It's constant hate filled nonsense that serves no purpose. You have absolutely no solutions to any of the problems you speak of, just complaints. You are part of the problem, not the solution. Mouse, you cannot possibly go through life every day blaming one man for all the Worlds problems. A majority of the problems you create for yourself. Try getting out and doing something about it. Make a difference. Lead don't follow. Posting constant hate on this website isn't making a difference.
May 16, 2012 at 8:40 a.m.
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kid3477........Great.......we're getting somewhere! So you would agree with me in saying that ultimately the homeowner him/herself should be held accountable and be considered responsible for finding themselves in a foreclosure process. I wasn't aware that you shared that perspective. Judging by the liberal posters in several of these foreclosure articles, it has been the fault of the banks, the employers, the 1%, Walker, Bush, etc.--anyone but the person who signed the contract promising to make good on a debt. I am glad that we both believe that in this case that the person who agreed to pay the loan should be held responsible for default.....I apologize for making the generalization:)
May 16, 2012 at 8:27 a.m.
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Mouse- My God, would you please learn how to complete a post that reads properly and doesn't sound like a 2 year old wrote it! And no, all caps doesn't count or make you sound any better. It's worse. Seriously, for the life of me, I don't know how you can't read what you right and think, wow..do I sound uneducated.
May 15, 2012 at 10:01 p.m.
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Obviously I don't use my home computer often;)
May 15, 2012 at 10:01 p.m.
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Mouse: I was vague because I didn't want to repeat it. Your words were 'This clown is going to rape Wisconsin'. Now read my vague post again.
916: Just the other day I saw someone stereotype you and you called it a 'pathetic stereotype', if I do recall. I've also seen you post 'lazy liberal' and now you say 'Typical liberal, always unable to take responsibility for anything'
If I had to choose I would consider myself liberal. You should come to the dealership and shake my hand. I'll show you how pathetic those stereotypes are.
May 15, 2012 at 9:22 p.m.
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Yada....your comment,"And don't forget - Scott Walker is taking $25.6 MILLION of the foreclosure money for his state budget - not caring about where the money is supposed to go." really surprises me. I thought you were a democrat. Don't they support taking from the few, when it involves benefiting the state as a whole? I suppose that mindset is only effective for you, when it involves taking from the few that you agree with........
May 15, 2012 at 9:16 p.m.
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Mouse......you probably blame walker for your total inability to spell and construct the simplest of sentences as well.......right? Typical liberal, always unable to take responsibility for anything.......it's always someone else's fault in your wierd, pathetic litte world......
May 15, 2012 at 5 p.m.
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Mouse. I really hope that you or someone you know never has to realize how wrong of a term that is that you used regarding Walker and the state of Wisconsin.
May 15, 2012 at 4:42 p.m.
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Its that darn Bush
May 15, 2012 at 3:57 p.m.
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Mouse - Janesville Mall seems to be dying to? Were you just born? The Mall has been hurting for many, many years. You ever researched what rent costs at the Mall? Ever realize that the big box stores put the smaller stores out of business? The simple fact that you blame Walker for all the Worlds problems including that your allergies are bothering you is simply comical.
May 15, 2012 at 2:23 p.m.
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yada yada yada. I'll quote your very own obnoxiously biased article...."money intended to help compensate those who were victims of the illegal mortgage practices".....
Is it not fair to say that the state of wisconsin was one of those victims?
May 15, 2012 at 1:05 p.m.
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And don't forget - Scott Walker is taking $25.6 MILLION of the foreclosure money for his state budget - not caring about where the money is supposed to go.
http://www.forbes.com/sites/rickungar/20...
May 15, 2012 at 10:44 a.m.
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The way you dish up your "truth" is like serving filet mignon off the bottom of a dumpster. doesn't matter if it's good, I'm not eating it. You sound like a 12 year old punk bashing x-box because you think playstation is better. You are probably a well informed person. Too bad you can't translate it in a useful manner.
May 15, 2012 at 10:04 a.m.
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get a life, rodent.
May 15, 2012 at 9:13 a.m.
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Saxcat - exactly... its a fine tuned system that works....they make tons of money off this.
May 15, 2012 at 8:32 a.m.
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dtb, they require an escrow account to make money off your money. If your house gets foreclosed for any reason, they make $$$. To say that they are trying to avoid this "problem" would make them chuckle.
May 14, 2012 at 9:46 p.m.
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What do they expect when they hand out super low interest rate mortgages? EVERYONE gets one... so naturally you have people that shouldnt have because they cant manage money and BAM! foreclosure.
May 14, 2012 at 9:40 p.m.
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Hardtobelieve: I'm sick to death of people who want to blame past presidents for the Countries "Continuing to worsen" messes.. even though Obama has almost been in Office for 4 yrs now. At what point will we be able to lay the blame at his feet? I'm not saying I'm a Bush fanatic.. to be honest, I think they all are lairs, bought & paid for by Big Money Donors (Big Petrol, Big Pharma, etc). I don't think I've ever seen.. in my entire life, such useless Politicians (on Both Sides), when it comes to "Domestic" issues. Obama has contributed to our continuing "Depression" (Recession my eye). I've been around long enough to live through both, & people who think we're not in a Depression, need to look up first.. the definition, & secondly, WAKE UP, & get the true statistics.. Not the Federal Governments Fantasy world stats. The nations Unemployment rate isn't any better now, then when Bush was in office 13.6 (I believe).. I wish I could do creative math like the Bureau of Labor gets away with. Now I'll stop so I can anxiously await your reply.. When does Obama take the blame for the choice he's made since day One? Is it going to be (God Forbid) during his 2d term sometime? Just before the 1st term is up? When?
May 14, 2012 at 5:37 p.m.
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And yet some of you want to recall Walker and put Barrett in, then watch property taxes go up. I guess then more homes will be foreclosed on.
May 14, 2012 at 4:24 p.m.
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In South Beloit a 50k home pays with a credit for the eldery of $200.00 a year. Yes $200.00
OK Janesville step and do better. I can see why people leave in droves.
May 14, 2012 at 4:22 p.m.
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Happy to hear Janesville is moving forward as a city. Yeah, right! I guess GM is not coming back.
Face it, Janesville is dying!
May 14, 2012 at 4:08 p.m.
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saxcat, many mortgages require an escrow account to avoid this very problem.
May 14, 2012 at 12:59 p.m.
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Hardtobelieve - Our past Governor is to blame for some of our problems. Just like the administration before that could be blamed. Same goes for our Presidents. They all have their shortfalls and caused the problems that exist today. They are politicians.
May 14, 2012 at 11:19 a.m.
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The right won't blame this on anyone. They pay their property taxes. :)
May 14, 2012 at 9:15 a.m.
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This must be Obama's fault because he was President in 2008, right? Oh wait. He did not become President until 2009!! Just wait, the right will somehow blame this on the current President even tho the same individuals will blame Wisconsin's problems on our past Govenor. Nothing like talking out of both sides of their mouth.
May 14, 2012 at 9:06 a.m.
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PT
May 14, 2012 at 4:49 a.m.
Perfect time to raise our property values, Make us put in sidewalks and institute a wheel tax.. Especially since most property owners are pretty much stuck here..
EXACTLY WHAT I WAS GOING TO POST...Agree with PT 100%
May 14, 2012 at 8:38 a.m.
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Don't escrow you taxes. Why should the bank make money off your money. Be responsible, and SAVE.
May 14, 2012 at 4:49 a.m.
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Perfect time to raise our property values, Make us put in sidewalks and institute a wheel tax.. Especially since most property owners are pretty much stuck here..
May 14, 2012 at 3:19 a.m.
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Make sure you check where that property tax came from. The exorbitant rates charged by Loan Servicers for their in-house Force Placed Insurance can push your Escrow Account (the same account used for taxes) far into the negative. This forces a borrower's payments up while also leaving them with no money left in escrow to pay their taxes.
Once again...it's the bank's fault...
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