We all know that the '08 Meltdown wound up transferring untold millions of dollars of real estate from the hands of homeowners to the hands of speculators and property management companies.
Now comes the new invasion: speculators who buy up liens against properties for small, unpaid bills (water, tax, etc).
Hit the squiggly for the story:
http://thinkprogress.org/...
The death of Freddie Gray in police custody in Baltimore and the ensuing protests brought the nation’s attention to the economic devastation that continues to grip the city. Now, new data shows powerful hedge funds are profiting off of struggling families in Baltimore by buying up debts as small as $250, charging high interest rates, and taking their homes when they fail to pay. A report just released by the research and advocacy group HedgeClippers documents how the Wall Street hedge fund Fortress Investment Group and the Los Angeles-based Imperial Capital bought up hundreds of these small liens this year — on everything from an unpaid water bills to delinquent property taxes — and could take property worth tens of millions of dollars if the families can’t pay.
Once the hedge funds buy up these small debts, they reap an 18 percent interest, according to the Baltimore-based research group The Abell Foundation. More fees pile up after four months, and if the families can’t pay, they lose their homes. An analysis of those impacted in 2014 found the families had been living in their homes an average of 21 years. Half were elderly, more than a third were disabled, and the majority were African American.
They passed a law to raise that amount to $500, but that's still a pitifully small amount compared to a home that can be worth $10s or $100s of thousands of dollars.
Most homeowners can arrange some sort of payment plan. Liens and foreclosures are supposed to be the "last resort" means to collect owed money.
So the city is left with ever more properties in ever fewer hands (one of the highest foreclosure rate in the US), an increasing stock of empty homes, and a rising homeless population.
And there doesn't seem to be much to be done about it. I can't help but wonder if this is happening elsewhere. Cash-strapped cities are selling off every other kind of payment generator (parking meters, etc).
Is this cycle of asset stripping by powerful elites ever going to stop? Or will we all wind up once again serfs on the Lord's lands?