NBA star Lamar Odom is among thousands of Floridians tripped up this year when big banks and hedge funds became tax collectors. Bank of America billed Odom for overdue property taxes, plus thousands of dollars in interest and fees.
Odom’s business manager says it was all a mix-up and the debt has since been paid, along with the bank’s charges.
Many property owners may not know that 51 of Florida's 67 counties sold more than $1.6 billion of real estate tax debt earlier this year, mostly to banks and hedge funds. The investors, many of them titans of Wall Street, can tack on interest and fees of at least 5 percent.
In the case of Odom, a forward for the Los Angeles Lakers, Miami-Dade County sold a $57,725 property tax lien on his $2.7 million home to an affiliate of Bank of America.
When the bank bought Odom’s bill in June, the debt included $5,000 in fees assessed by Miami-Dade. The bank tacked on $2,886 more in interest, according to the county tax collector’s office.
Brian Irvine, who manages Odom’s business affairs, said the delay in sending the property tax payment stemmed from the county sending the bill to the wrong address.
Irvine expressed frustration over the process. “People want to make money however they can these days,” he said.
Bank of America declined comment. A spokeswoman said the bank doesn’t discuss its tax liens investments or individual debtors.
The Florida tax sale imperiled a wide range of real estate this year – some pricey, such as property in Key West just a few blocks from Ernest Hemingway's historic home and museum, sprawling homes in golfing retirement communities and even a few oceanfront buildings, tax sale records show.
Bank of America also bought liens on properties owned by nonprofit public interest organizations, such as a wildlife rescue group that has helped restore the health of birds befouled by oil in the Gulf of Mexico.
The Suncoast Seabird Sanctuary, the country's largest wild bird hospital, had a more than $16,000 debt sold to Bank of America after it's funding dried up and it couldn’t work out a repayment plan with the local tax collector.
"We called Pinellas County and asked to please make payment arrangements and they would not accept our good faith efforts,” said Michelle Glean Simoneau, a spokeswoman for the sanctuary in Indian Shores, Fla.
Simoneau said she's angry at the process and at Bank of America. “We don't want any huge banking industry taking advantage of people or nonprofits like us that are struggling through this very difficult time," she said.
Bank of America purchased liens on other nonprofits such as a Salvation Army shelter, a building owned by the Florida Conference of Seventh-day Adventists and a preschool in Lauderdale Lakes.
Phyl’s Academy Preschools paid off a $13,587 debt to Broward County two weeks after Bank of America bought the bill. But the preschool still had to pay 7 percent interest – nearly $700 in additional charges, according to Broward County tax records.
Many low-income Floridians also had debts sold to Bank of America in this year's tax sale. Some homeowners contacted for this story said the process had left them confused and angry. Several said they had no idea that they had fallen into arrears on their taxes or that the debt had been sold to Bank of America.
“I was not aware of it," said Rosemary Knight, 65, a retired social worker who had a $589 tax bill sold to Bank of America in June. Knight has been out of work for the last 15 years, she said, because of diabetes, hypertension and kidney ailments.
Lily Grayson, 75, has lived alone in her Clearwater, Fla., home since her husband died in 2005. Grayson, a retired waitress, says she was unaware that Pinellas County sold a $692 lien on her home to an affiliate of Bank of America.
“I think it’s terrible,” that the banks are making money off of struggling homeowners, she said. “I’m not happy about it but what do you do?”
Julian Hattem and Peter Tartaglione contributed to this story.
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