New report: Arizona citizens are losing 99% of their home equity in unconstitutional foreclosure scheme; pending legislation aims to end the practice

Phoenix; February 17, 2020: Home equity is property. Taking it is home equity theft. Yet in Arizona, the property tax foreclosure process results in a complete loss of home equity, beyond what is owed for property taxes, interest, and fees.

A new report released today details how tax foreclosures in Arizona’s most populous county have left property owners with a loss of more than 99 percent of their home equity. It explains how:

• If you mistakenly underpay or fall behind on your property taxes in Arizona, an investor can bid for the right to take your home for pennies on the dollar. Under current law, homeowners lose everything in this process, including years of equity, no matter how small the tax debt.
• Hundreds of Arizonans have lost their homes for debts as small as $16.46. The remaining 99% of home equity was stolen, up to 99.9% in some cases.
• Maricopa County property owners alone had more than $9 million in home equity stolen between 2016 and 2019.

Thankfully, the Arizona State Legislature has the opportunity to correct this injustice. The Equity Theft Prevention Act (HB 2445) is before the legislature now, and the House Ways and Means Committee will hold a hearing and vote on the bill this Wednesday.

“In Arizona and 12 other states, unpaid property taxes can lead to theft of home equity,” said PLF’s Legal Policy Director Daniel Dew. “HB 2445 would put an end to this egregious and unconstitutional practice in Arizona. This bill will ensure that Arizonans’ property rights are protected.”

The full report and more information about HB 2445 are available at pd.pacificlegal.org/hometheft