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Time running out for Detroit owners to save foreclosed homes

Christine MacDonald
The Detroit News
Restored homes are seen along Leverette Street in Corktown.

Detroit — Time is running out for owners of foreclosed homes to save their properties through a new program. 

It's a part of a recent ACLU of Michigan settlement of its 2016 lawsuit against Detroit that includes the chance for low-income owner-occupants of foreclosed homes to buy their properties back for $1,000.

Under the plan, occupied homes headed to this year's fall tax auction will instead be bought by the city and sold to owner-occupants who can prove they qualify for the city's poverty tax exemption or have in the past. The exemption lowers or eliminates tax bills for those who qualify.

But those interested have to apply by Aug. 24 with the housing nonprofit, United Community Housing Coalition, officials said. 

"There is still time," said Michele Oberholtzer, director of the group's Tax Foreclosure Prevention Project. "But it is urgent that people come in as soon as possible."

The nonprofit has about 140 applicants so far in the process. The group has knocked on doors of all the foreclosed properties believed to be occupied, trying to educate owners and done mailings. They plan on visiting homes a second time before the deadline.

The nonprofit has gotten funds from the city and foundations to purchase the homes. They've also launched an online fundraiser

The best way to participate is to go to the group's office at 2727 Second Ave. Suite 313 in Detroit or by calling (313) 963-3310 ext. 339. They have walk-in hours from 9 a.m. to noon Mondays, Wednesdays and Fridays. And the group holds workshops for the program at 5 p.m. Tuesdays and 11 a.m. Wednesdays and Fridays. Those interested should show up a half-hour early.

Applicants should bring financial information, such as proof of income and tax returns, along with the deed for their home. Its recommended they bring a $500 down payment as well.  

To take advantage, homeowners have to prove they could have qualified for the tax exemption between 2014 and 2017 but didn't receive one. If the homeowner qualifies this year for the tax break, they only have to sign a sworn statement they would have qualified in the past and won't have to produce old documentation proving their income

Only Detroit owners can qualify. Homeowners who are in payment plans with the treasurer can't participate. 

This year, about 700 owner-occupied homes in Detroit are estimated to be at risk of being sold at the fall tax foreclosure auction, Wayne County Treasurer Eric Sabree has said

The ACLU sued the city in Wayne County Circuit Court two years ago over how it administered the state-mandated property tax break for the poor, arguing it was inaccessible to the vast majority of homeowners who were needlessly losing their homes to foreclosure.