20 homeowners get reprieve on foreclosure

PHOTOGRAPHER: Kathleen Moore

Share on Facebook

Save

Twenty homeowners will escape foreclosure this year, Corporation Counsel John Polster said.

He will not foreclose on owner-occupants who have not paid their taxes but lived in their house during the entire time the tax debt was accumulating and do not have more than one rental unit on the property.

The decision does not help Aaron Graham, who is paying off the taxes owed after his grandmother died in 2005. He moved here years later and has made payments for three years but has not yet caught up. His house is scheduled to be foreclosed upon on Friday.

And it doesn’t help Savita Liladhar, who did not pay taxes for four years but now wants to pay. She claims that she didn’t know her house could be taken if she didn’t pay the taxes. She has two rental units, so she’s not eligible for the exemption. She also has tenants but did not use their rent to pay the taxes.

But some people will escape — for now. Polster will begin foreclosure proceedings again in December, and all 20 homeowners who qualified for the deal will face foreclosure then. However, it takes months to foreclose, which gives them some time to pay off their debt.

Among the few who will keep their house are Fred and Darlene Lee, who live on Hamilton Hill. Fred Lee runs the city-wide neighborhood watch, as well as Schenectady United Neighborhoods. Darlene Lee is on the Civilian Police Review Board and has been active in city work for many years. She was among those who helped to organize Weed and Seed, a federally funded effort to reduce crime on Hamilton Hill.

They said they fell behind on their taxes after they bought other houses on their street but could not find tenants who had jobs and weren’t involved in crime.

“We had no idea how difficult it would be to rent,” Fred Lee said.

The Lees had intended to remodel the houses, rent them out and then offer a rent-to-own program to good tenants.

After years of work, Lee said, “even we had to admit: this dog ain’t hunting.”

They tried to sell but no one would buy. They offered to give the properties away to Habitat for Humanity “or anybody who would take them” but still got no offers.

Lee’s business, in which he teaches student pilots and sells planes, slowed significantly during the recession, and they got behind on the taxes for the rental houses, he said. ATF offered a payment plan, which Lee accepted.

“I thought it was a square deal,” he said. “The city gets its full payment, we’ll pay a little bit in interest and we’ll work out a payment plan.”

He wasn’t expecting 21 percent interest.

Eventually they sold one house and let ATF foreclose on another. In the meantime, they fell behind on the taxes for their own house.

Lee is confident he’ll pay off the taxes.

“I’ll work my fanny off, I’ll make as much money as I can and we’ll get this paid off,” he said. “In light of the world economy, it’s going to be a stretch.”

A nonprofit group that faced foreclosure has also been taken off the list.

Koinonia Christian Center, which bought a vacant building on McClyman Street to turn into a community center, did not pay the taxes that were required in the first year.

Properties cannot be taken off the tax roll mid-year; owners must file for tax-exempt status by March 1 and wait until the next tax roll for tax exemptions.

The Rev. Ted Ward said he didn’t know he had to pay taxes, which amounted to $2,177.

He was also billed for water fees, which all nonprofit groups must pay. But he protested the fee because the water to the building had been shut off before he bought it.

He was billed $4,132 for the water that he didn’t use.

After three years, he also accumulated $3,325 in interest, but the city offered to remove it if he would pay the rest. He refused, asking for it all to be erased.

“We have a small congregation,” he said.

Polster said he would look into the matter after completing the other foreclosures on Friday. If the water was legally turned off, with contractors taking out a permit to do the work, the city should not have billed for water usage, he said.