Minneapolis; March 22, 2021: Hennepin County stole tens of thousands of dollars from 92-year-old Geraldine Tyler when it sold her condo to settle a tax debt and kept far more than she owed. Today Tyler asked the 8th Circuit Court of Appeals to end this injustice and return her property.
Tyler moved out of her Minneapolis condo in 2010 because rising crime was concerning her. Unable to pay her property taxes on the condo and the rent on her new apartment, the debt began piling up. Her $2,300 debt quickly ballooned to $15,000 with penalties, interest, and fees. The county foreclosed on the property in 2015 and sold it a year later for $40,000. Instead of returning the surplus funds to Tyler, the county pocketed all the proceeds from the sale.
“The equity that people have in their homes is property, and it’s protected by the U.S. and Minnesota Constitutions,” said Christina Martin, a senior attorney at Pacific Legal Foundation. “Although the government can take property to settle tax debts, it can’t take more than it is owed. Doing so amounts to unlawful home equity theft.”
Unfortunately, Geraldine Tyler’s story isn’t unique in Minnesota. Between 2014 and 2020, more than a thousand Minnesota families lost their homes and all their home equity for tax debts that averaged just 8 percent of the value of their homes.
Minnesota is one of a shrinking number of states that allow local governments and private investors to reap windfalls when they take property. Last year, the Michigan Supreme Court found a similar law unconstitutional, ruling that people have a right to any surplus proceeds from a tax foreclosure sale after back taxes are paid.
Pacific Legal Foundation is committed to ending the practice of home equity theft across the country.
Pacific Legal Foundation represents Geraldine Tyler free of charge with the assistance of Charles Watkins of Guin, Stokes & Evans, LLC, and attorneys at Reinhardt Wendorf & Blanchfield, and Teske Katz, PLLP.
Pacific Legal Foundation is a national nonprofit legal organization that defends Americans threatened by government overreach and abuse. Since our founding in 1973, we challenge the government when it violates individual liberty and constitutional rights. With active cases in 39 states plus Washington, D.C., PLF represents clients in state and federal courts, with 12 victories out of 14 cases heard by the U.S. Supreme Court.
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