Wayne Residents on Brink of Foreclosure Get a Bit More Time

Activists demonstrated outside the Wayne County Treasurer’s Office Tuesday to protest foreclosures on 38,000 homes – 16,000 of which are occupied. (Screenshot via WJBK-TV)

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Wayne County residents on the brink of losing their homes to foreclosure have a bit more time to pay their delinquent taxes.

The deadline to pay delinquent taxes has been extended to May 12, County Treasurer Raymond Wojtowicz said Tuesday, the same day the Detroit City Council urged a moratorium on foreclosures until the state legislature can pass tax relief packages.

Wojtowicz’s staff is skeptical extending the deadline will help. Some activists have called for the process to be halted entirely, but the treasurer’s staff says that could cause taxpayers to fall deeper in debt in Wayne County, where pending foreclosures are at record levels.

Tuesday had been the deadline to pay the back taxes. If property owners aren’t able to meet the May 12 deadline, their properties will be auctioned in the fall.

About two dozen picketers marched at the treasurer’s Greektown offices, and activists also demonstrated in front of Wojtowicz’s home.

Cheryl West, one of the activists who had been evicted from her home, told WJBK-TV the foreclosures could bring tensions to a head.

“This has got to stop,” she said. “We’re on the verge of another riot. I hate to say that, but we are.”

Surquetta Morgan, 38, fears she’ll face the same fate West did and lose her home over a $4,000 tax debt. She had shared the home for 17 years with her husband, who recently died, and she’s afraid she’ll lose custody of her two small children if she becomes homeless.

“I am worried my house is going to get taken. My kids are going to get taken,” Morgan said. “I am just praying.”

Chief Deputy Treasurer David Szymanski said in an email to The Detroit News officials want to help taxpayers avoid foreclosure.

“This is one step to make sure people can access the new programs granted by the legislature to reduce interest and save their homes,” he wrote.

Among the programs is a recent law signed by Gov. Rick Snyder that allows county treasurers to lower interest on unpaid tax debt from 18 percent to 6 percent. In many cases, that will mean that back taxes can be capped at a quarter of the market value of the home. Homeowners would be required to follow a payment plan to repay the property taxes they owe.

Related:

• Bills Before Lame-Duck Legislature Would Stave Off Another Housing Meltdown

At the time the legislature was considering the bill, Detroit Mayor Mike Duggan said keeping people in their homes was important to stabilize neighborhoods. He also announced tax-relief programs Tuesday that will help some homeowners avoid foreclosure.

Last summer Wojtowicz’s office began foreclosure proceedings on 75,000 properties, the majority of them in Detroit. By mid-March, only about half of the property owners had paid their back taxes or worked out payment plans.

About 38,000 properties are in foreclosure, and about 16,000 of those homes are occupied, according to estimates.

Activists with the Moratorium Now Coalition have said Wayne County is “in a state of emergency” because of the pending foreclosures that could remove up to 10,000 people from their homes – a number Szymanski said was a “tremendous exaggeration.”

He said those occupying the homes could likely stay there under a landlord-tenant arrangement if the properties are sold in foreclosure.

“We want people to stay in their homes,” he said. “If they can’t afford payments, go ahead and don’t pay taxes until the auction. You are living there rent-free. Hopefully, the new owner can say ‘Hey, do you want to rent from me’ and there will be an orderly transition.”