<body><div> MANISTEE COUNTY — A Bear Lake woman is taking to the Michigan Supreme Court over the aftermath of her 2021 home foreclosure. <h2 class="cci_subhead" title="CCI Subhead"><a class="chapter-anchor" id="thefacts_1723037983731" tabindex="0"></a> The facts </h2> Chelsea Koetter, a single mother of two sons, lived in her Bear Lake residence from 2016-2021. Koetter fell behind on her property taxes, and enlisted the aid of her family to help pay everything off, according to a <a href="https://reason.com/wp-content/uploads/2024/07/koetter-home-equity-theft-complaint.pdf" rel="noopener nofollow" target="_blank"> Michigan Supreme Court document from July 24 </a> . Koetter’s family helped pay off her property taxes for 2019 and 2020. To ensure everything was up to date, Koetter’s father spoke with a Bear Lake Township employee to “verify that all taxes were paid” and “looked up records and confirmed that I was paying all taxes that were due,” according to the July 24 document. Koetter said&nbsp;the township employee mistakenly told her she had paid all remaining property taxes, leaving a portion of her 2018 property taxes accidentally unpaid. This&nbsp;led to the debt collectors — Manistee County —&nbsp;seizing and foreclosing&nbsp;the home. The circuit court entered a judgement on Feb 12, 2021, to foreclose Koetter’s home and collect $1,199.59 in 2018 property taxes, plus $831.93 in interest and fees. The title of Koetter’s home was taken by the county on April 1, 2021. Two notices were sent in the mail to Koetter’s residence — one prior to foreclosure and one following foreclosure — stating that owners must submit a claim form to make a claim for any remaining money following their home’s auction. No claim forms were included in the notices, according to the July 24 court document. In June 2021, Koetter and her grandmother went to the Manistee County Treasurer’s office to “attempt to correct things.” In the Michigan Supreme Court document from July 24, Koetter’s grandmother said that “no one mentioned that a form could be filled out for claiming proceeds for the sale and no one gave (her) the form.” <figure><img src="https://img.particlenews.com/image.php?type=thumbnail_580x000&amp;url=3Qnyq5_0uqVVqd900" alt="https://img.particlenews.com/image.php?url=3Qnyq5_0uqVVqd900" width="650" height="488" ><figcaption>The Manistee County Treasurer's Office is located in the Manistee County Courthouse and Government Center at 415 Third St. in Manistee. (File Photo) </figcaption></figure> Koetter said she only heard about the claim form submission by a family friend. On July 9, 2021, Koetter submitted the notarized claim form seeking to receive her future just compensation, a payment to property owners following the legal seizure of their house, property or land, for the taking of more property than what was needed to pay her outstanding debt. The form, however, was due on July 1, leaving&nbsp;Koetter eight days late for claim approval. The county rejected her claim form as tardy. The county auctioned off Koetter’s home to her father for $106,500 on Aug. 2, 2021, then kept the remaining $102,636. With the help of attorneys, Koetter attempted to complete and submit another just compensation claim form on Aug. 18. The county again denied her form, stating that she was now 48 days late from the July 1 deadline. In August 2022, after several failed attempts by Koetter to oppose the county’s decision to reject her claim form, a trial court held that the government could avoid paying just compensation to Koetter because she failed to “follow the statutory claim process to the letter,” according to the <a href="https://reason.com/wp-content/uploads/2024/07/koetter-home-equity-theft-complaint.pdf" rel="noopener nofollow" target="_blank"> Michigan Supreme Court document from July 24 </a> . <h2 class="cci_subhead" title="CCI Subhead"><a class="chapter-anchor" id="appeal_1723037784322" tabindex="0"></a> Appeal </h2> Now, Koetter has sought the <a href="https://pacificlegal.org/" rel="noopener nofollow" target="_blank"> Pacific Legal Foundation's </a> counsel&nbsp;and has filed an application for leave to appeal with the Michigan Supreme Court. The Pacific Legal Foundation is a nonprofit, public interest law firm that defends Americans against government overreach and abuse, according to their website, <a href="https://pacificlegal.org/" rel="noopener nofollow" target="_blank"> pacificlegal.org </a> . <a href="https://pacificlegal.org/staff/christina-martin/" rel="noopener nofollow" target="_blank"> Christina Martin </a> , the attorney representing Koetter's state Supreme Court case, said the county underwent what the Pacific Legal Foundation calls “home equity theft.” “It’s essentially what happens when the government, instead of just taking what it’s owed in taxes, penalties, interest fees and costs, takes your entire house and all of the value of it, and then gets the windfall from that,” Martin explained. According to <a href="https://apnews.com/article/michigan-supreme-court-tax-windfalls-foreclosure-60a1fb76af1b0fc6c9fc4983c949523c" rel="nofollow"> a report by the Associated Press </a> in July, a recent development can allow the <a href="https://www.manisteenews.com/insider/article/Manistee-County-to-move-forward-with-tax-15429265.php" rel="noopener nofollow" target="_blank"> Michigan Supreme Court’s 2020 decision </a> to stop local governments from keeping cash windfalls from the sale of foreclosed homes to be applied retroactively. This means that hundreds of millions of dollars could potentially be returned to foreclosed homeowners from recent years. Martin said that affected people&nbsp;like Koetter who are often overwhelmed by foreclosure, but the potential to receive their just compensation could change their lives. “This would mean a lot to Chelsea. Obviously, you’re talking about $102,000 at stake for her, but (this ruling) could also impact hundreds of people around the state,” Martin said. “(This problem) usually is at the expense of society’s most vulnerable members, people who are struggling. … They can’t afford to hire lawyers. They don’t understand what’s going on.” Koetter’s application for leave to appeal was filed with the Michigan Supreme Court on July 24 and awaits further action. “We have been fighting home equity theft for a very long time and we’re troubled by how Michigan’s law is working like backdoor home equity theft,” Martin said. “Some people will manage to navigate the claim process, but most people don’t.&nbsp;For regular people, this is really, really perilous. I’m hoping that the Michigan Supreme Court will see that and correct it.” Conversely, <a href="https://www.manisteecountymi.gov/256/Treasurer" rel="noopener nofollow" target="_blank"> Manistee County Treasurer </a> Rachel Nelson said that her office helps 96% of delinquent taxpayers avoid foreclosure through their efforts. “My office works very hard to help folks with delinquent taxes understand what is happening, connect them with resources and avoid foreclosure,” Nelson said. While Nelson agreed that the state legislature’s 2020 decision on the claim process has helped “numerous” foreclosed homeowners recover their surplus money in Manistee County, she stated that people who are impacted&nbsp;must stay on top of critical action dates. “The law requires that a former owner take action within a certain period of time in order to make a claim. Ms. Koetter did not act in time, and so the court denied her claim,” Nelson said. Nelson urges anyone with past due property taxes to reach out to her office as soon as possible to avoid serious consequences, reminding the public that “the sooner we hear from you, the more we can do to help.” Martin hopes the state Supreme Court will fix the laws in place to “limit the government’s ability to take advantage of people.” “The government is supposed to protect people, right?" she said. "Not exploit them, not prey upon them when they’re struggling. … It should stop.” </div></body>

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Manistee County woman takes foreclosure case to state Supreme Court

\"For regular people, this is really, really perilous. I’m hoping that the Michigan Supreme Court will see that and correct it.”

"For regular people, this is really, really perilous. I’m hoping that the Michigan Supreme Court will see that and correct it.”