Foreclosures Leading To Tax Defaulting Cases in Merced County

This year the property tax defaulting cases have increased in Merced County by about 3%. This means that the defaulters will be slapped with late fees and the county has to take a loan to keep on its rails. This is a new fall out of the foreclosure crisis in Merced County – something that will inevitable catch on to other regions.

Karen Adams is the treasurer and tax collector of Merced County. She comments that here the situation is similar to that of many Central Valley counties. There are innumerable foreclosures and that means taxes are falling behind. It translates into less funds for the administration. The amount is staggering. Karen Adams estimates that above $20 million is due from property taxes. Most of the defaulters are foreclosed property owners – the latter being either the borrowers or the banks. The problem for the county is that it has to continue paying its dues to school districts and cities although its tax kitty is getting empty by the day.

The Auditor Controller of Merced County, Stephen Jones says that all the units know how much they are to get, and they also know that they will get it. But the problem is that the amount reaches them in June and not on the scheduled months of either December or April. The reserve amount at the disposal of the county is only for a limited short period. For the first time in a decade that reserve will not cover all the commitments.

Karen Adams bemoans, “Now we’re having to dip into county dollars to borrow to make sure all those taxes are paid whole.” Eventually all the money will be realized but it will be late. Some seizure operations will also be have to be undertaken. She hopes that a good number of house owners will avail of payment plans and other similar programmes being offered to help defaulters avoid foreclosures and meet their bill commitments. Adams added that her office is ready to sit down with the troubled foreclosure victims regarding payment plans. Moreover there are various other programmes for seniors and the physically challenged. She advised that those troubled by foreclosure should contact not only the office of tax collection but simultaneously also the mortgage companies as well as state legislators. She underlined that the worst thing to do is not to do anything!