This morning's Northwest Herald reports the foreclosure on Galt Airport by Harris Bank. According to the article, "Taxes ($22,796) for the five parcels connected with Galt Airport were sold at a tax sale Dec. 2."
A Decatur firm bought four of the five tax obligations, and an Evanston firm bought the fifth. I'm not certain how soon after non-payment the taxes can be paid by a third party, which then acquires certain rights to the property. The original obligor has a right to redeem the property from the clutches of the tax payer by paying the taxes and interest.
Interest levies on tax sales rise quickly, making tax purchases a healthy investment. If I recall correctly, the interest is set by statute. Maybe a real estate lawyer will weigh in here with an explanation...
The article further stated that Michael Stanard, owner of Studio@OneZeroCharlie, sold his interest in the airport more than a year ago. Stanard is not named in the foreclosure action.
In recent years Stanard organized and held concerts on the airport property. He was in the news a while back, when he objected to a demand from McHenry County Sheriff Keith Nygren that Stanard hire off-duty sheriff's deputies at $40.00/hour to provide security. Stanard claimed that the sheriff threatened to close roads to the airport, if he didn't hire the deputies.
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Actually, Gus, I think that you'll find - if you check out the statutes - that tax purchases BID on the parcels, i.e. they bid the interest rate that they will charge and the lowest bid on the interest is the one that wins. Actually, it's a really fair system that provides a win-win situation. The county and other taxing bodies get the money right away and should the property owner decide to redeem the property, they get the lowest rate of interest to pay.
From www.taxsales.com/il-usa.htm:
"Illinois is a tax certificate sales type state. Both individuals or the state can end up as holders of the tax sale certificates. The annualized yield received by a holder of a tax sale certificate can be unbelievable. It is a little complicated but can be sorted out with a little study. The successful bidder at a tax certificate sale is the person willing to accept the certificate with the lowest PENALTY PERCENTAGE. The maximum penalty on none farm land is 18% and on farm land is 12%. This is a PENALTY - NOT INTEREST. The penalty applies each six month period or fraction thereof prior to redemption making the annualized yield on a bid of 18% a minimum of 36%."
Call it what you will, the principle is the same. Taxing body gets their money, the rate of penalty is determined by the LOWEST bidder and there is a cap of 36% per annum. Ever bother to check and see what the annualized rate is on those pesky paycheck loans? Damn! I've read of people killed for a lot less. Really surprising that somebody hasn't gone off the deep end when they realize they're paying a COUPLE HUNDRED PERCENT interest to tide themselves over.
Yes, the payday loan sharks used to charge 700+% A.P.R., until our wise legislators interfered and cut them back to a maximum of about 350%.
It would be interesting to know how many of those payday loan businesses are owned by legislators!
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