This Nebraska Man Almost Lost His Home and All of Its Equity Over a Small Tax Debt. He Just Won in Court.
For years, Kevin Fair has been staring down a coarse reality: poised to have his home seized, along with all of its equity, because he accrued a modest debt on his property taxes. The Nebraska Supreme Court last week said that was unconstitutional.
That such a decision needed to be spelled out in the first place may sound dire. The absurdity of that is dwarfed by the fact that he nearly lost.
Fair is familiar with loss. In 2013, he quit his job to care for his wife, Terry, who had been diagnosed with multiple sclerosis. Living on his Social Security, the Fairs were unable to pay their 2014 property tax bill. That $588 debt would set in motion a chain of events that ultimately ended in the Scotts Bluff County government giving a private investor the deed to their home.
In 2015, that investor, Continental Resources, quietly purchased the Fairs’ tax debt and continued satisfying the bill with the government. In 2018, the company then sent the couple the charges: $5,268 for the overdue taxes, along with penalties, interest, and fees. If they couldn’t pay within 90 days, the company had the right to take the home to pay the debt.
It would also get to keep the profit.
The latter assertion sparked a legal odyssey that saw the Fairs challenge the legality of Nebraska’s state-sanctioned home equity theft as the family sought to cling to their house. The value of the home—about $60,000—far exceeded their total debt. But under Nebraska law, it was kosher for investment firms to pocket the surplus equity, meaning the Fairs would be forced to pay an additional $55,000 for their inability to satisfy a $5,268 balance.
This was par for the course in Nebraska when people fell behind on their property taxes. “People are shocked about how the law actually operates,” Jennifer Gaughan, chief of legal strategy at Legal Aid of Nebraska, which represents Fair, told me last year. “It’s usually elderly people…people who own their homes outright who don’t have a mortgage
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