OPPOSE

Statement submitted to the Banks Committee

February 10, 2011

By
Michael Casey, Chairman Legislative/Political Affairs Committee

My name is Michael Casey and I'm Chairman of the Legislative Committee of the Connecticut Associations of REALTOR®

As someone else rightly said, this bill removing the exemption for foreclosure sales is like "pouring salt into the wounds" of distressed sellers. On behalf of the Association, I urge you to oppose it.

Proponents of the bill say its purpose is to "increase the collection of …tax revenue." The first priority of the government should be to reduce spending so we don't need to increase tax revenue.

Proponents of the bill would apply multiple town and state conveyance taxes to the final purchase price - - debt plus any remaining equity. For the homeowners struggling to regain an economic footing, it's like kicking him while he's down. And the notion in the loosely-worded bill that the legislature will simply force the banks, not the seller, to pay the taxes is poorly thought out. Banks will likely obtain a deficiency judgment against that home seller that will follow him for years. In any event, the lender already pays a conveyance tax when selling the foreclosed property to a new buyer.

REALTOR® opposition to real estate conveyance taxes is long-standing. This very committee, under the leadership of former Representative Ryan Barry and Senator Bob Duff, unanimously exempted these transactions as well as short sales last year.

It was the right thing to do!

I'll be happy to answer any questions.