County owners of foreclosed properties must register the purchase or face a fine. Photo from Wikimedia Commons.
Property owners who fail to register a foreclosure purchase as required under Maryland law will face a $1,000 fine under legislation the County Council passed unanimously last week.
“We have hundreds of vacant properties that were foreclosed all over Montgomery County, many, many in Silver Spring,” said Councilmember Tom Hucker (D-District 5), the bill’s lead sponsor. “In many cases, they’re a nuisance, they attract crime and arson, they bring down property values, and generally they are owned by national lenders or hedge funds that have repurchased them, and they are left to rot in communities until they are resold.
“It’s a big problem in Maryland,” he continued. “We have the third most foreclosures in the country and Montgomery County has some of the highest numbers of foreclosures in the state.”
Under Maryland law, purchasers of a foreclosed property must register the property with the Maryland Department of Labor, Licensing and Regulation and the Maryland Foreclosure Task Force within 30 days of the foreclosure sale.
“The law was meant to address the period of nine to 18 months that frequently occurs between the date of a foreclosure and the date that the property title is transferred. During this time, local jurisdictions have a hard time identifying the party responsible for maintenance, security and taxes,” according to a council press release.
“Based on the data from the State Foreclosure Registry, there were 1,432 foreclosures in Montgomery County in Fiscal Year 2015. Of these, 34 percent (492) either failed to register or registered long after the deadline,” the release continued.
“There’s more public safety response calls for first responders to foreclosed and otherwise vacant houses because squatters go in there, homeless people, drug parties, all kinds of stuff,” Hucker said.
There’s an incentive for the purchasers not to register, he said, “because if they don’t transfer the title, they don’t pay the transfer tax,” which averages $6-7,000 per property.
Without the registry, county personnel would have to do manual searches in the Clerk of the Courts office to discover who owned the property, a timely and expensive process.
This week, Hucker expects the council to pass another of his bills that would deal with individually owned vacant properties.
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