Jump to content

Received Summons for Property Tax


zooyork
 Share

Recommended Posts

In 2003 my mother declared chapter 7 bankruptcy including her home. Her home was refinanced at the time with the land being used as collateral. Moms bk lawyer advised her to pay any property tax due for 2003 but not after. She has been sent property tax bills for subsequent years and today she was served a summons.

We are a bit confused as to how to proceed. If she filed bankruptcy on the house, with the land being used as collateral, wouldn't the mortgage company retain ownership of the land and therefore be responsible for the property tax? How should she respond to the summons? Should she contact her bk lawyer? Will the court issue a tax lien in order to move forward with the property foreclosure?

Q: Who is suing you?

A: The board of City Commissioners

Q. For how much?

A: 1100.00

Q. Who is the original creditor?

A: County Property Tax

Q. How do you know you are being sued?

A: She was served, I assume this is the first step in being sued?

Q. How were you served? Were you served?

A: My mom was at work when the sheriff deputy served the papers to my sister.

Q. What was your correspondence (if any) with the people suing you before you think you were being sued?

A: None

Q. Where do you live?

A: Kansas

Q. When is the last time you paid on this account?

A: 2003

Q. What is the status of your case (if anything has been opened)? You can find this by a) calling the court or B) looking it up online (many states have this information posted daily).

A: Unknown at this time.

Q. Have you disputed the debt with the credit bureaus (both the original creditor and the collection agency?)

A: Not sure this applies.

Q. Did you request debt validation before the suit was filed? If not, don't bother doing this now.

A: Not sure this applies.

Q. Does your summons require a response? Did you receive an interrogatory (questionnaire) regarding the lawsuit?

A: Yes the summons states:

"You are hereby notified that an action has been commenced against you in this court. You are required to file your answer to the petition with the court and serve a copy upon _ plaintiff's attorney, at _ within 20 days after service of summons upon you. If you fail to do so, judgment by default will be taken against you for the relief demanded in the petition. Any related claim which you may have against the plaintiff must be stated as a counterclaim in your answer or you will thereafter be barred from making such claim in any other action."

No questionnaire was provided.

Q. What evidence did they send with the summons? An affidavit? A statement from the OC? Anything else they attached as exhibits?

A: Nothing

Q. What is the SOL on the debt?

A: Not sure how this applies.

Link to comment
Share on other sites

I am a little confused about the property taxes. The BK is a 'snapshot' in time to get rid of debt that you have accumulated - not future debt. When the BK was filed did your mother lose her home in the BK? Or did she get to keep her home? If she lost her home then I am not understanding how the property tax bill could be still in her name for the past five years. Is this bill from 2003 or another year? Please explain.

Link to comment
Share on other sites

Hi Denita -

Yes, she included her home in the bk and hasn't lived at that address since 2003. In her records, she has a receipt stating the 2003 property taxes were paid in full. I believe they are trying to collect for 2004 and 2005.

The property has been vacant since she left.

Any idea what she can/should do? Thanks!

Link to comment
Share on other sites

Hi Denita -

Yes, she included her home in the bk and hasn't lived at that address since 2003. In her records, she has a receipt stating the 2003 property taxes were paid in full. I believe they are trying to collect for 2004 and 2005.

The property has been vacant since she left.

Any idea what she can/should do? Thanks!

The very first thing she should do is get a copy of her BK matrix and discharge papers to show that the property was given back in the chapter 7. She should then call the attorney that handled the BK right away to get this resolved.

There are others on this forum that are BK attorney that can answer more specifically the steps you/she should do - but it does sound like a violation to me.

Link to comment
Share on other sites

Okay. I am thinking this is what happened. Just a possibility but would explain what is happening:

The mortgage was included in the bankruptcy. Your mother had no personal liability for the mortgage whatsoever. The lien on the property remains through bankruptcy.

The mortgage company never took action to foreclose. Foreclosure means they move to take back the collateral. This would mean your mother still owns the home but the lien remains.

Was the property handed over in the Chapter 7? Did the title change? If not, she still owns a home, subject to a lien. That would mean the taxes are just accruing unpaid.

Link to comment
Share on other sites

Op, have you called the tax collector? Sounds like your mom technically at least on paper owned the home past the bk date. Maybe they did not forclose right away. I know that in my home state the property tax becomes the first lien every year and if not paid they will sell the property to get that tax money (there are a few steps before this happens, this is just an example)

So maybe the lender was served notice of impending tax sale and then decided to forclose to protect their interest. I don't know there seems to be a piece of the puzzle missing.

I would call the tax collector and share your story with them. :)

Link to comment
Share on other sites

The last question was more for myself. I am just curious why the bk lawyer would or wouldn't have listed the property on the discharge papers.
Because there are two things going on here. You have a mortgage obligation which was discharged and then you have the property itself. If there was no non-exempt equity in the property that would provide for a meaningful distribution, the trustee may have had no interest in the property.

That leaves the lender the option to enforce the lien, which survives the bankruptcy. If they didn't enforce it, then she may still be the owner of the property at this point, subject to the lien.

Or maybe not. I'd call the attorney and see what the heck happened back in 2005. And call the tax collector.

Link to comment
Share on other sites

jq26 and jrbauto1 - thank you for responding! You've both asked some good questions that I cannot answer at this time. Mom is coming over tonight so I can get more information then.

Ok, If the lender never foreclosed, she is technically still the owner, subject to the lien? What does subject to the lien mean in this scenario?

Link to comment
Share on other sites

A lien attaches to the a secure debt. As a practical matter in this case, it means that if the property is sold, it has to be satisfied (paid). This is a voluntary lien- she voluntarily gave them a lien on the home when they cut her a check for the mortgage amount. Some liens are also involuntary (unpaid tax liens, judgment lien). If she is the owner, then the tax should have been paid. She would have maintained ownership.

I'd call the tax collector. In my limited experience with county tax departments, they were very friendly. I'd be willing to bet that they'd explain the scenario- especially if mom happens to be a senior citizen.

Then get in touch with the BK attorney. They should keep records.

You can also either go online or go to the courthouse and pull the title on the home. See who is on it for the past few years.

Until we know more, we're just speculating...

Link to comment
Share on other sites

I thought I would update this thread - good news!

I spoke with the attorney's office this morning who said that if mom did not want the property(which she doesn't), no action was needed from her. They reassured me that nothing negative would come out of this other then the debt would be satisfied for the delinquent property taxes by the sale. If it's not sold then it goes back to the county.

She said that mom did not have to answer the summons. Is this a good idea or should we go ahead and put some kind of statement together and send to the attorney?

Lastly, thanks to everyone who replied to our thread! You rock!

Link to comment
Share on other sites

Guest
This topic is now closed to further replies.
 Share

×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.. For more information, please see our Privacy Policy and Terms of Use.