Someone to Lien on: Privatization of Delinquent Property Tax Liens and Tax Sale Surplus in Massachusetts

Abstract

In Massachusetts, as well as in twenty-eight other states in the nation, municipalities can sell delinquent property tax liens to private investors. In exchange for paying for the debt, the private entity can collect interest rates of up to sixteen percent and levy additional fees on the homeowner. If the homeowner is unable to pay the rapidly growing amount they owe, absolute title of the property, which includes any profits from the subsequent sale, passes to the private entity—providing them with the property for pennies on the dollar. This practice was introduced as a tool to enable municipalities to collect due property tax, but has had particularly devastating effects on vulnerable members of society and tends to cause economic distress in ways that have been largely ignored. This Note argues that such practices are unjust, inequitable, and likely unconstitutional. Legislative and pre-litigation solutions should be enacted to protect these members of society from predatory tactics.