Preventing Tax Foreclosure: Michigan Counties Partner with State

About the Program

Category: Community and Economic Development (Best in Category)

Year: 2014

Six County Treasurers worked with Michigan’s lead housing agency to deploy federal Hardest Hit funding to prevent property tax foreclosure. In 2010, the federal government authorized $7.6 billion in “Hardest Hit Funds” to mitigate the mortgage foreclosure crisis in 18 states most devastated during the great recession. Each state developed locally-tailored programs to assist struggling homeowners. The funds are typically used to subsidize mortgage payments during unemployment, to catch up on delinquent mortgage payments, and to modify mortgage loans to reduce negative equity. In Michigan, the Michigan State Housing Development Authority (MSHDA) was designated to administer the “Hardest Hit Funds.” Six County Treasurers, in the counties of Genesee, Ingham, Kent, Newaygo, Washtenaw, and Wayne, proposed to MSHDA and the U.S. Department of Treasury that delinquent property taxes become an eligible use of Hardest Hit Funds. We believe Michigan is the only state assisting homeowners without mortgage problems by making payment of delinquent taxes directly to local units of government. The six County Treasurers and MSHDA designed a program which began in mid-January 2013. Nearly all Michigan counties agreed to participate and we now have one year’s worth of data: the results are impressive – $28.6 million was distributed, serving 3,432 families.