Lawsuits grow as Illinois lags on reforming property tax sale laws

CHICAGO (WLS) -- An obscure practice that lets private investors extract millions in equity from Illinois homeowners is now under legal fire.

For decades, county treasurers in Illinois have collected unpaid property tax bills by selling the debt to private investors. If homeowners behind on their taxes fail to repay the debt plus interest, those investors can get the deed to their homes. In those cases, the homeowners lose the entire value of their residences, even though they often owe only a fraction of that amount.

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In 2023, the Supreme Court ruled that such actions are unconstitutional. Following the ruling, states rushed to reform their laws to avoid legal fallout. However, Illinois is the only state that has yet to reform its tax sale laws.

You can read more about the legal battle for reform at illinoisanswers.org.