Ever notice a nice-looking house or building which has been vacant for years and no one seems to know why? You might assume that even though the outside of the structure is attractive, surely the inside must be a wreck (busted pipes, moldy walls, nests of raccoons and possums swapping stories about the good old days, etc). Surprisingly, this is often not the case. If structure has been winterized and properly sealed up to keep out the elements, it can sometimes sit vacant for years while experiencing only an insignificant amount of interior damage.
Did you know that sometimes the only thing that keeps a nice structure out of circulation is PAPERWORK? We’re talking back taxes, liens, and encumbrances which scare away homebuyers and even the most stout-hearted of investors. This is where agencies like the Cook County Land Bank Authority (CCLBA) step in and work their Hogwarts magic. They have the power to waive all the taxes, water bills, receivership liens, etc. and give the property a tabula rasa to make it more desirable to buyers. And THAT is why they have earned the right to put the word “authority” in their name. CCLBA is a boss. Boom!
"Land banks, as defined by the Center for Community Progress, are governmental entities or special-purpose nonprofit corporations that acquire problem properties, eliminate liabilities, then transfer the properties to new owners. The goal is to return the properties to productive use—and to the tax rolls—in accordance with community goals. Land banks often have special powers, including the ability to obtain property at low or no cost through the tax foreclosure process and to hold land tax-free, according to the center’s 2014 report Take It to the Bank."
--An article posted on the CCLBA website titled "Land Banks Helping Rebuild From Legacy of Foreclosure"
But if you are like me you always want to know “What is the catch? Why would our cash-strapped local government give up on trying to collect legitimate taxes owed a property?” Here’s the dirty little secret: the government (local, state, federal) will bend over backwards to help renters transition to buyers because it generates more taxes. But if the only catch to having the opportunity to live in a place I can call my own is to pay taxes, then WHATEVER! That’s an easy decision. I’ll take it! The decision makers have resolved that they’ll never collect those back taxes anyway so why not cut their loses and offer a chance to a new owner? Check out this Next City article,"Chicago's Land Bank Will Use Big Data to Target Vacant Homes."
I have known about this program for a while, but what I learned more about on the Auburn Gresham trolley tour was how excellent this program really is. CCLB has launched a new Homebuyer Direct Program. The website says “the focus of this program lies in reaching out to prospective homeowners who may be interested in directly purchasing, rehabbing and ultimately living in the home of their dreams!...[T]he CCLBA is looking to offer properties throughout Cook County to prospective owner-occupants at below-market prices. This could be a perfect opportunity for you to engage in the purchase/rehab, finish it to your taste, and build in some equity!”
I'll share more with you about the CCLBA on Wednesday. Whether you're a homebuyer or investor, you don't want to miss these important details about how this great program can benefit your life.
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