Opening up about foreclosure
At noon on Wednesday, Sept. 27, the Wareham treasurer's department sold two foreclosed properties in a public auction.
While not an unusual occurrence, the auction did have one unusual element. The town can no longer keep all of the money from the sale of foreclosed properties the way it used to.
When a property has its taxes in arrears — meaning money owed — the town can take its owners to land court and foreclose it.
From there, the town owns the property outright, and it can sell the property in a public auction, said Treasurer John Foster.
In Wednesday's auction, Wareham made $350,300 from the sale of a property on 7th Avenue, and $133,400 from the sale of a vacant lot at 16 Wareham Avenue.
The town uses the money from the sale to repay the taxes owed on the property, as well as to pay attorney bills and other fees associated with proceedings.
Foster says one property sold for more than the taxes owed on it and the other sold for less in Wednesday's auction.
In prior years, if the town sold a property for more than it was owed, the town could keep the rest of the money.
That changed this year with a precedent setting Supreme Court decision.
The case Tyler v. Hennepin County, originating in Michigan, established that municipalities can only keep the amount of money owed from foreclosure sales, not the excess profit.
Prosecutors in the case argued the government isn’t supposed to take private property for public use without compensating the owners, and the Supreme Court agreed, according to analysis from scotusblog.com.
The decision leaves towns holding the figurative bag.
For now, Wareham is setting the excess money from the sale aside, said Foster.
The town has not yet received guidance from Massachusetts on what to do with that money, Foster added, but is holding it in preparation for when the state gives direction.