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Saturday, November 29, 2014

Report: State lawmakers set to act on looming metro Detroit foreclosure crisis

Posted By on Sat, Nov 29, 2014 at 9:00 AM

In the coming months, Wayne County has plans to foreclose on tens of thousands of metro Detroit properties, a plan so potentially catastrophic, it could usher in a downturn on the scale of the 2008 housing crisis, according to a report in the Detroit Free Press today.

But state legislators are hoping to address the issue in the coming weeks it what will likely be a chaotic lame-duck session. From the Freep:

The two bills have strong support from Detroit Mayor Mike Duggan. In different ways, both would let county treasurers reduce or eliminate the penalties and heavy interest — as high as 18% a year — that quickly accumulate under state law when homeowners get behind on property taxes.

"We have to keep people in their homes — it's really hard to stabilize the neighborhoods when you force people out through foreclosure," Duggan said this week. He called Gov. Rick Snyder and "took him through the details and told him we'd be pushing these" in the Legislature's lame-duck session, Duggan said. Snyder, traveling in China earlier this week, could not be reached for comment.

Duggan told the newspaper that the goal of the bills would be to allow county treasurers to forgive a taxpayers past-due interest and penalties, as long as they sign-on to a payment plan. Reporter Bill Laitner carefully detailed the issue with striking anecdotes and comments from lawmakers; the whole piece is worth a read, which you can check out here

Meanwhile, if you're interested in understanding the roots of Detroit's current foreclosure problem, former Metro Times writer Lisa Collins penned a cover story way back in 2003 on an issue only in its infant stages: the rise of predatory lending. It's also well worth your time to read here

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