Wayne Co. halts foreclosures on certain owner-occupied homes

A ruling issued Tuesday by a Wayne County judge will keep some owner-occupied properties out of tax foreclosure for the next year.

Wayne County Treasurer Eric Sabree said he petitioned the Third Circuit Court to stop foreclosures on people owing back property taxes for the years 2017-2019.

Judge Timothy Kenny agreed to extend the redemption period through March 31, 2023, due to the continued impact of the COVID-19 pandemic and the availability of federal funds.

It protects approximately 1,800 Wayne County properties, mostly in Detroit, that were expected to be foreclosed on Thursday when the current moratorium was set to expire. 

The order does not apply to property owners with tax debt in 2016 or prior years.

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“Our number one priority remains keeping people in their homes and too many Wayne County taxpayers are still suffering significant economic hardship due to the COVID-19 crisis,” Sabree said in a press release. “We also know that while many have applied for property tax relief from certain programs, they needed more time to compile the appropriate paperwork. So, we continue to make some allowances considering the pandemic.”

The choice of years was made because the foreclosure timing for the 2017-2019 tax years fell squarely during the pandemic – between 2020 and 2022, Sabree said.

The order came hours after the Detroit City Council unanimously passed a resolution Tuesday afternoon asking Sabree to extend the expiring moratorium on property tax foreclosures through the remainder of the year.

Sabree previously said he couldn't extend the moratorium, saying the law requires his office to collect taxes to service 43 communities in the state's largest county. 

When Sabree announced the moratorium on March 16, 2020, it allowed the people living in around 13,800 county homes to remain in their homes. 

The county foreclosed on 145,458 parcels between 2005 and 2017, an analysis by Detroit data firm Regrid found, about a third of all properties in the city. 

The Coalition for Property Tax Justice has been calling for Sabree to extend the moratorium, stating that aside from the pandemic, massive flooding last summer caused significant damage to homes, creating further expenses for homeowners to repair.

Owner-occupants who apply to a state program for relief, the Michigan Homeowners Assistance Fund, are eligible to have their property removed from foreclosure, regardless of the delinquent tax year.

To qualify for MIHAF, applicants must have experienced a qualified financial hardship due to the coronavirus pandemic after January 2020 or had a qualified hardship that began before and continued after that date. They also must meet income eligibility requirements, and the property must be owner-occupied. The maximum amount of assistance available through MIHAF per household is $25,000. 

“It’s important that individuals still apply because through MIHAF, it can not only eliminate back property tax debt, but also halt the accrual of interest,” Sabree said. “Our hope is that a significant number of Wayne County residents will qualify for this relief.”

For more information, go to treasurer.waynecounty.com or contact the office by email at taxinfo@waynecounty.com or call (313) 224-5990.

srahal@detroitnews.com

Twitter: @SarahRahal_