1. Show ME THE MONEY!
MUNCIPAL TAX LIENS: POST-ACQUISITION COLLECTION and ETHICAL CONSIDERATIONS
The Marcus Law Firm Edwin P. Farrow Esq. Maria R. Salatto Esq. & Thomas M. Melfi Esq. Hosted by Walter M. Spader Esq.

2. “NOT SHOW YOU, SHOW ME THE MONEY!”
ROD TIDWELL:
OUR CLIENTS
JERRY MCGUIRE: THE MARCUS LAW FIRM

3. TAX LIEN Industry PERCEPTION

4. TAX LIEN Industry REALITY
Over $4 Billion in delinquent property taxes sold to Private Investors each year in US.
The NTLA has indicated that more than 99% of all tax liens sold to investors are redeemed prior to foreclosure judgment.
West Haven, CT Tax Lien Foreclosures
Between : WH assigned 12,295 liens, of which approximately only (3.3%) had a foreclosure action brought and of those, our clients took title to only 12 properties (0.10%)
NYC Tax Lien Foreclosures
Between : 41,400 property tax liens were sold  only (0.86%) were foreclosed on.
Individual Investors (according to the NTLA) typically earn 4%-7% a year after expenses on this type of investment.

5. YOU’VE WON THE BID…NOW WHAT?
What did you acquire?
Secured Debt (real property tax liens) OR
Unsecured Debt (service/water/sewer tax liens)
FAIR DEBT COLLECTION
What is the FDCPA ? (15 USC § 1692)
Does the FDCPA apply to my lien?
Staub v. Harris, 626 F.2d property taxes not “debts” under the FDCPA
FDCPA is a strict liability statute
PRACTICE HINT – Don’t use taxing authority symbols in your mailings to avoid confusion and to not create a false impression that a debt collector is associated with any government or municipality (Gammon v GC Services).

6. Pre-Foreclosure Bankruptcy Concerns
Always file your proof of claim!
Chapter 7 – largely protected
Chapter 13 – Most taxpayers won’t complete their plans, taxpayer is trying to avoid foreclosure, likely paid off by mortgage company.
Watch for CRAM DOWN
WATCH YOUR RIGHTS and PROTECT YOURSELF!
Interest rights can be altered in Bankruptcy, a plan can even be 0%!

7. Opening your File Know your Jurisdiction! Know your Liens!
Know the Pre-Foreclosure Steps
Keep Records!

8. Referral to Your Attorney
Deciding to go the Foreclosure route – relationship with Law Firm is a “partnership”.
What does your attorney need from you?
Balance due, Ownership information, additional parcels owned by tax payer
Broker Price Opinions/Valuations
Contiguous parcel information
Report of all of your contact with the debtor – will help attorney plan defenses, help marshal find debtors/parties for service, and help you contact any heirs if necessary.
MOST IMPORTANTLY!!!! – you need to inform your attorney about how aggressively you would like the liens to be pursued.
Quick foreclosure when you want to obtain title
Less aggressive foreclosure when you are in a positive long term equity position

9. What Will Your Attorney Do?
Demand Letters
Payment Arrangements
Title Searches & Appraisals
Commencing Foreclosure

10. ADDITIONAL FORECLOSURE CONSIDERATIONS
Defenses:
Do they impact validity of lien?
Are they valid?
Bankruptcy Filings during foreclosure:
make sure its real, get a docket number
Chapter 7?
Chapter 13?
Fees and costs?
Recoverable?
Minimizing overhead

11. Alternative collections CONSIDERATIONS
Collections Actions
Condemnation Collections
Fire/Insurance Collection
Reassignment of Liens
Bottom of the barrel liens

12. So HOW DO YOU SHOW ME THE MONEY?
Building trust with the municipalities
Your on going relationship with your attorney
The attorney’s relationship with the judges/magistrates
Ultimately, the relationship you have with the DELIQUENT TAXPAYER can be a large factor in how successful you are in your collection efforts

13. THANK YOU FROM “THE DREAM TEAM”