A lawsuit alleges that Cuyahoga County has relied on tax-deed mechanisms to take possession of private homes from delinquent residents without compensating them with the property’s market-value surplus following foreclosure.
CLEVELAND, Ohio – A lawsuit accuses the Cuyahoga County government of unlawfully taking millions of dollars in home equity from local property owners who fell behind on their taxes over the past two decades.
Though that method is permitted by state statute, it flies in the face of the U.S. and Ohio constitutions, representing “a systematic, institutionalized, multi-decade practice and policy to profit from property owners beyond the taxes and fees those property owners owed,” the complaint alleges. The practice largely affects residents who are poor, elderly or from minority communities, it claims.
The lawsuit centers on the process of foreclosure. Typically, when a homeowner falls behind on property taxes, a county can enforce a tax lien by foreclosing and selling the property at an auction, but then return any surplus value — the difference between the owed taxes and the property value — to the former owner, according to the lawsuit.
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