Code enforcement liens many times of value - Posted by michaela-CA

Real Estate Investing
#1

Posted by michaela-CA on June 20, 2007 at 13:49:11:

Kristine,
noone seems to know who actually placed the various amounts. All they have is a listing, which is kind of crazy. e.g.

fisc.yr taxes Del. Penal Red. Pen. total
1988 8,039 803.90 26,046.48 34,899.42
1991 1,458 145.84 3,937.89 5,552.21
1992 18,314.34 1831.42 46,152.13 66,307.89
1993 18,616.46 1861.64 46m562.51 64,050.61
1994 228.36 22.82 493.25 754.43
and so on

absolutely no consistency. I think most of these numbers are code enforcement and not actual 'property taxes. Probably neglect and then a $ 500 per day fine or something like that.

I have the county supervisor trying to split this apart right now.

Michaela

#2

Code enforcement liens many times of value - Posted by michaela-CA

Posted by michaela-CA on June 18, 2007 at 14:31:11:

I have this lot I’m looking at. AM in contact with the owner.
Went to the tax office today and was told that back taxes are
about $ 250,000. Many times it’s value. Taxes haven’t been paid since '88., but most of this is code enforcement liens.

I went to code enforcement and they told me, ‘sorry, cna’t do anything about it’. Tax office also told me they couldn’t do anything about it. Neither one of these offices can even tell me which amount is taxes and which is code enforcement. THis goes back years and years.

I was told a few days ago by another investor, that California has some kind of federal law, that pushes the city to auction a proeprty, if taxes haven’t been paid after 4 years. Well, this property has been up for tax auction for the past 2 years and of course noone bought.

It still belongs to the owner.

Has anybody ever dealt with this?

Michaela

#3

Charles, Chris and RIch - Posted by michaela-CA

Posted by michaela-CA on June 18, 2007 at 20:14:17:

thank you so much for your input. You’ve all given me a lot of new angles to approach this from. Being new in California, some of these offices are new to me and I didn’t even know these people existed.

I have every intention to make this one happen and I will report a follow-up.

Michaela

#4

Re: Code enforcement liens many times of value - Posted by Rich-CA

Posted by Rich-CA on June 18, 2007 at 19:27:11:

Bottom line in CA, if its placed by a government agency, either that agency, its supervising elected officials (such as a wastewater lien placed by EBMUD) can reverse it. If not them, then the County Supervisors can also. It part of having a government supposedly accessible by the citizens.

I many cases, the group responsible for planning is well aware of the blight areas and will be quite helpful for the opportunity to get that off their plates.

#5

Re: Code enforcement liens many times of value - Posted by Chris - Fl

Posted by Chris - Fl on June 18, 2007 at 18:02:06:

A few years ago a wholesaler brought me a deal at a very good price. Before closing my title company discovered there were over 35K in fines due to the grass not being mowed and $100 a day fine by code enforcement. Turns out the property was tied up in probate for a very long time and the heirs were out of state. My wholesaler went to a county board meeting and pleaded his case stating we were going to buy this house and fix it up. They initially balked due to the fact that there was over $50k in profit to be made but once the investor reminded them that no profit and no fines would be paid if they weren’t willing to work with us. They dropped the fine down to $500 and we closed 3 days later.

#6

Re: Code enforcement liens many times of value - Posted by Charles Parrish

Posted by Charles Parrish on June 18, 2007 at 15:41:01:

Write a contract of sale subject to a discount by the county tax office. Make sure you are getting at a wholesale price. Than go to the tax sale dept. and negotiate a discount, if that does not work go to higher authority.

I have done this in Baltimore and purchased a property for $28,000 that had $56,000 in liens on it. I had to go to the Mayors office to appeal to them, but it worked.

Charles

#7

Re: Code enforcement liens many times of value - Posted by michaela-CA

Posted by michaela-CA on June 18, 2007 at 19:40:22:

Rich,

I have sent emails to the Director of Economic dev. of Oakland, the mayor of Oakland, The council person. And I will figure out who the county supervisor is and contact them. If it’s a guy, then I will dress up nicely, with high heels and make-up and go in person :wink:

Michaela

#8

Re: Code enforcement liens many times of value - Posted by michaela-CA

Posted by michaela-CA on June 18, 2007 at 18:05:59:

Chris,

thank you for that idea. I will check when the next county board meeting is and persue it that way as well.

Michaela

#9

Re: Code enforcement liens many times of value - Posted by michaela-CA

Posted by michaela-CA on June 18, 2007 at 16:23:09:

Charles,

thanks you! At least I now know, that some cities may work with you. I hope this helps here. Have gone to the tax office and spoke to the mgr, who won’t budge. Claims it can’t be done.

I have now sent an email to the director of development, as well as the council person. If that doesn’t work, then I will go to the mayor’s office.

Thank you for giving me hope.

I do have a contract for 45K, let’s hope I can make it happen. I already have a buyer, who knows the situation and is willing to work with me, if the city wants to see plans of what I want to build there.

Michaela

ps: It’s weird how every city/ctate is different. In Atlanta they can’t even collect code liens after 7 years. They just get deleted.

#10

Re: Code enforcement liens many times of value - Posted by Rich-CA

Posted by Rich-CA on June 18, 2007 at 19:45:07:

The Board website is here:

http://www.acgov.org/board/

You might also look for the planning commission and get referrals to the people who give out money to imrpove blighted areas. Haven’t done this myself, but my mother serves on such a board in CT (where I’m from).

#11

Re: Code enforcement liens many times of value - Posted by Rick, the Probate Guy

Posted by Rick, the Probate Guy on June 19, 2007 at 22:44:31:

I think that the first issue is to determine if these liens are, in fact, super-priority liens. If so, they attach along with the property tax roles in most senior position.

I’m largely in favor of using attorneys to separate the wheat from the chaff in cases like this. If you have a contract (EP or other) and have tied the property up sufficiently and secured your position appropriately, then I’d spend the money to put pressure on Mr. Bureaucrat to get off his chair and help you. Same for City Finance people. Maybe a little help from someone in the press (“little old man is run over by bureaucratic train…”).

Niec to chat with you the other day. Hope this works out well for you.

#12

Here’s a question, maybe you know - Posted by michaela-CA

Posted by michaela-CA on June 20, 2007 at 06:26:14:

Rick,

In Atlanta any liens - taxes, code enforcement, demo, sewer - can only be collected for the past 7 years. I would think there’s some kind of law on that. If there’s a law in one state, then you’d think that other states have similar. Do you know, if there’s anything like tha tin California? Or where I would find something like that? I know you’re more into probate, but I thought I’d throw it out.

Michaela

#13

Re: Code enforcement liens many times of value - Posted by michaela-CA

Posted by michaela-CA on June 20, 2007 at 06:17:37:

Hi, RIck,

I’m trying to get an appointment with the director of economic dev. She has already received an email from the councilwoman, asking to meet with me and that she’d support this. I also have the person at the county supervisors office working on it. So, I’m trying different angles. Unfortunately, I don’t have the funds to get an attorney involved at this time.I’m determined to get something done with this.

Having found out, that the city has tried to auction and that a ton of builders and investors have been licking their chops after this one, but backed off when they couldn’t find the seller and found out a bout the liens, just gives me this totally competitive charge ;-). I’d love to be able to say 'nje, nje, nje,nje,nje,nje - lol.

Yes, nice talking to you and thank you for your info.

Michaela

#14

city or county? - Posted by Kristine-CA

Posted by Kristine-CA on June 20, 2007 at 10:11:21:

Michaela: is the director of EC for the city or county? My concern is
that there are issues with both municipalities on this property. One
step at a time of course, but the city can’t make the county do
anything, it can only address its costs on the property.

From all the references and stories I’ve seen and heard over the years
to counties reversing taxes due, I’ve never seen evidence of it actually
happening (in CA). I’ve seen counties give the properties to cities (as
provided in the civil code) and I’ve seen cities auction properties for
city $$ owed, but those are sold subject-2 the county taxes.

I’d love for you to be the one who finds the way on this one. Keep us
posted. Kristine