What Is The Syracuse Land Bank & How Does The Process Work?
By now I am sure that most of you have heard of the Syracuse Land Bank but many of you are unaware of the purpose that it serves.
The Syracuse Land Bank is a tool that was implemented by the city who is working in tandem with the Syracuse government to acquire properties that the city seizes for back taxes.
In 2011, the land bank began with the purpose to "market the properties that can be fixed and demolish the ones that can't"
This entity acts in a similar manner as a bank or lender would when foreclosing on your property. Instead of being foreclosed on due to deficiencies in your loan payments, you are being foreclosed on due to unpaid back taxes.
The sole purpose of the Syracuse Land Bank is to revitalize certain neighborhoods and recoup the unpaid debt that is owed to the city.
This is a vehicle that the city uses to acquire, hold and sell properties that have been seized due to unpaid taxes.
So what exactly is the Syracuse Land Bank?
According to the city of Syracuse "Land Banks are a vehicle to better coordinate the acquisition, management and re-use of vacant and abandoned property. A Land Bank has the ability to streamline and expedite the often costly and cumbersome foreclosure process. Land Banks also allow the community to engage the private sector in the work of re purposing vacant properties in a fashion that is most consistent with each municipality’s goals – whether that means selling an old house to a responsible occupant willing to rehab it, or demolishing a condemned structure and converting the lot into green space."
Also for the "For the properties that the County is unable to collect on, the existence of the Land Bank allows the County to transfer the properties to it without bearing the financial and legal burden of owning them."
This essentially means that the title of the property will be transferred over to the city and then the city will sell then property for either the unpaid tax amount or an amount above the delinquent taxes.
The question is, is the city of Syracuse truly acting in a manner to restore our neighborhoods and protect the people or are they using this entity to add to revenues.
The Syracuse Land Bank Process & How It Effects Homeowners
The Syracuse Land Bank takes on a very similar process as the government when it comes to tax lien foreclosures.
When homeowners fail to pay their property taxes for a certain amount of time, the city will issue them a Notice of Default.
This Notice of Default will outline the total amount of unpaid taxes that are owed plus any additional fees, costs or interest.
If the homeowner fails to act on this request and begin making payments towards their delinquent taxes, the city will then issue a 30 day advanced notice of the sale of the property.
This is typically when the foreclosure proceedings should begin. A petition of foreclosure should be issued to the property owner to let them know that the proceedings have begun and if they do not act soon the property will be seized.
The typical time for a homeowner to get foreclosed on due to unpaid property taxes is 3 years. This means that the homeowner has not made a single payment in the past 3 years. If the homeowner has made partial payments throughout this term, then the foreclosure process will be extended.
If the homeowner does not act and make payments throughout this process, the city will seize the property and the homeowner will go through foreclosure. The foreclosure process can do severe damage to credit; causes tax complications and hinders further property purchases.
A foreclosure will immediately drop your credit score anywhere from 250-280 points. You will need about 3 years or more of on time payments to restore your credit score. Many people are unaware of the tax consequences of a foreclosure. Any time that tax is forgiven it is considered a taxable event. This means that if this tax amount is cancelled or forgiven, it needs to be included for tax purposes. The loan amount is then considered as income because there is no longer an obligation to repay the lender for the same.
Since a foreclosure affects your FICO score in a negative way you will have a very hard time getting a mortgage on a future house until your credit has been restored. The chart below gives you a better look at the waiting period required by lenders for specific foreclosure circumstances.
Wrapping Up the Syracuse Land Bank
We hope that this has given you some more detail on what the land bank is, how it works and how it affects homeowners. Sometimes in life we are hit with hard times and taxes are last on our list to be paid. We also want you to understand that you have options during the tax foreclosure process. If paying your taxes is not an option, we want to make sure that you avoid the credit hit from having your property seized.
We created a service that's sole purpose to help homeowners who find themselves in this exact situation. We offer you an alternative option to the repossession of your home by the city. It is a very simple process and one that will have no effect on your credit score. What we will do is purchase the property directly from you before the city can seize your property. This will result in some additional cash for you and also relieve you of all of your unpaid taxes. We want you guys to know that is a very beneficial alternative and if you find yourself in this situation, give us a call. If you would like to learn more about this option, simply head over to this page and we will give you all of the information that you need to start this process.
HS Property Funds
Funds to Help, Problems to Solve