Connecticut State Quietly Extends Conveyance Tax On Real Estate To Include Foreclosures

Desperate for funds Connecticut State has extended conveyance tax on real estate to include foreclosures

. It will become effective from 1st January 2010. Although the state will collect enhanced revenue it is as yet unclear whether the lenders will pay or they will pass it on to the already besieged homeowners. Politicians are blaming each other while others are not available for comment.

Republican Senator Tony Guglielmo said, My initial position was, and still is, I'd like to get rid of the conveyance tax, but it doesn't seem to be happening. This prompted him to submit a bill early in January to extend the tax on to foreclosures so that the banks would be compelled to pay their share. He elaborated, You have a little old lady who may be going into a nursing home (and selling her house). She pays it, but Bank of America doesn't? Most people would consider that unfair -- the banks had a special privilege. There was no public hearing on the bill.

Another Republican senator Len Fasano said that he had suggested on similar lines last summer during closed doors talks on the budget held in the mansion of the governor. He was surprised to hear that it had already been included in the final programme on spending. The Democrats had permitted it to be become law by Governor Rell in early September. Fasano complained, No one said 'Hey Len, how will that work? Who pays it'?

During the debate on the budget held late at night the conveyance tax imposed on foreclosures was briefly questioned. According to the discussion, Senator Andrew Roraback (Republican) directly mentioned Senator Bob Duff (Democrat) and his attempts to contain foreclosures. Roraback said, I'm fearful that this bill with the left hand may be undoing what we tried to do with the right hand, which is get people from out under the mountains of debt which they've incurred. If I'm a homeowner that's had my house foreclosed on, and the bank came and they auctioned off my house, is this tax now going to be added to my debt?

Erin Kemple of Connecticut Fair Housing Center said, Most of the costs to a lender are passed on to the consumer. When the borrower is trying to figure out how much they need to be able to save their home, the cost of anything is going to be included in that.

Fritz Conway of Connecticut Bankers Association commented, Obviously the person being foreclosed upon would be on the hook.

by: Julie Thompson

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