In our area, the banks can start active foreclosure after the 3rd month of non-payment. That means they will start sending you certified letters. By the 6 month you will receive a certified letter from a law firm. Many times it can take yrs to foreclose on the property (where the sheriff comes and physically escorts you and your stuff out onto the street) purely due to tha mount of foreclosures in your area. In our area, many will do a short sale, thus the list is short, and from start to finish it could last 12-18 months. 18 months is rare, 12 is the traditional amount of time.
I would assume a place like Vegas, where they have a very high rate of foreclosures you would probably see the 3 yr marker.
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Raising a teenager is like nailing Jello to a tree
It varies, for example in our county the banks do pay the RE taxes. They are not exempt. Here's the reason why. The number one lien on any property are RE taxes. If they are not paid the county gets to seize the property. Banks are not about to allow this to occur. Now depending on what company owns the property they have the ability to auction it or sell it via the MRIS. If they decide to auction it, traditionally what will occur is the bank will have an opening price and an itsy bitsy asterisk stating + all back taxes and liens.
The house usually goes for less, but the bank gets to recoup the money of the taxes, thus, it is a flush.
The true problem with local tax shortfalls are not the foreclosed properties, but homeowners who are delinquent because the banks have yet to foreclose on the property, thus there is no money left in escrow to pay the RE taxes.
The other problem is that as prices drop, the county/city have two options:
1. re-assess the mill rate to recapture the costs with lower home assessments
or
2. Leave it be and hope that the avg taxpayer does not know they can contest the assessment, AND that they don't know there is a short window to do this within.
(usually it is about 90 days when they receive the tax bill for the upcoming yr)
The uneducated home owner that has escrow very rarely looks at the bill from the county. It is only when they receive their new mtg saying there is a shortage in their escrow that they find out, which typically is past that time frame.
Counties are having shortages, but it is more than just the tax bill. Many counties during the booming times, built new schools, libraries, fire depts, etc. with the expectation that more people would buy, thus, a larger base.
Additionally if you know anything about the county tax system, you would know that the big bulk of it is not RE, but corporate taxes. When companies start closing up their businesses that is when the shortfall really begins. It is much harder to get money from a corporation who defaulted, due to bankruptcy laws than anything else.
Businesses start to leave, so do the employees.
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Raising a teenager is like nailing Jello to a tree
Certainly they wouldn't be eligible for a "homestead exemption". But they probably get incredibly favorable treatment.
As banks convert tax paying properties into vacant drags on local property values, how much downside is there for them?
As far as tax breaks being necessary for banks to make loans in an area, EVERY area is distressed. Why not "stick it to the banks" to alleviate local tax shortfalls?
