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The next nightmare in the Taylor, Bean & Whitaker national mortgage loan fiasco is playing out in Peoria and Joliet — actually, throughout Illinois and other places where property taxes were due in full this month.
Thousands of property owners are receiving delinquency notes, because their taxes were never paid out of paralyzed Taylor Bean escrow accounts.
Exhibit one is Will County, the fourth-largest county in Illinois (county seat: Joliet).
Will County Treasurer Pat McGuire is charged with collecting taxes for 1,746 parcels that were escrowed by Taylor Bean. Only 398 of them, all serviced by Bank of America, made the Sept. 1 deadline; all the rest were shipped delinquency notices last week.
On Monday, McGuire's office started receiving a deluge of calls from those homeowners caught in the ongoing struggle over accounting within Taylor Bean, the Ocala-based lender that abruptly shuttered its lending operation in early August and filed for bankruptcy.
Taylor Bean's escrow problem centers on accounts the company has with Colonial Bank, which was seized by regulators last month in the biggest bank failure so far this year. Customers reported both insurance and taxes not being paid out of escrow; others who refinanced through the company have received the overage from their escrow accounts in checks from Taylor Bean, which bounced.
The Federal Deposit Insurance Corp., as Colonial Bank's receiver, and Taylor Bean's attorneys are working on a bankruptcy court plan to resolve control of the escrow accounts and customer records, but regulators have indicated it could take weeks for borrowers to see relief.
"We're in a tight time frame, and if people haven't paid (taxes) in full by mid October, I have to publish their names in the paper," McGuire said, acknowledging it isn't fair "to people who played by the rules."
The unpaid taxes are not only assessed 1.5 percent monthly late fees, they could be sold at an auction if not paid in full by Nov. 3. That tacks on potentially much higher interest rates for property owners to catch up.
McGuire contacted the Illinois Attorney General's Office, in essence asking to be sued so he can be restrained by a judge from going forward with publishing names. "I don't want to do this. … I've been looking for some guidance," he said. "We're trying to steer through this fog, but it's pretty thick."
At least in this latest twist, Floridians have a little time.
County taxes in Florida aren't due in full until April, with property owners receiving a 4 percent discount if they pay in full this November.
In Pinellas County alone, Taylor Bean handled taxes for 1,498 mortgages paid out of escrow in 2008, said Sam McClelland, chief deputy to Tax Collector Diane Nelson.
Jeff Harrington can be reached at jharrington@sptimes.com or (727) 893-8242.
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