Home-buyer-friendly policies help out in S.C.

South Carolina doesn't often set economic trends, which helps explain why local foreclosure rates remained fairly steady last year while national headlines called attention to dramatically rising rates elsewhere.

But state regulations played a role in the trend, too, according to Charleston County Master-in-Equity Judge Mikell Scarborough, whose office handles foreclosure cases.

South Carolina property owners get the title to their land after the sale closes. But in some other states — especially in the Western half of the country — a property owner's title is held by a title insurance company, Scarborough explained.

"In the event that you don't pay on the mortgage, they just take your property," he said.

"It's a process of just filing some paperwork. It usually takes no more than 30 days."

And for lenders in those states, the legal part of the foreclosure process takes less time, too.

In South Carolina, a lender has to wait about 90 days after a first missed payment before filing a foreclosure lawsuit. And after that, they have to wait for a response, look up other liens or mortgages on the property, and sometimes schedule hearings or appointments following that.

By the time a property hits the county auction block, a property owner hasn't made payments for at least six months, Scarborough said. "It's actually a more consumer-friendly state," he said.

Even so, it's pretty clear that the foreclosure trend is ripening here. Scarborough said the list of properties scheduled to be auctioned off Tuesday is the longest he's seen since taking office five years ago.

During the first three months of this year, lenders filed foreclosure proceedings on a total of 874 residential properties in the tri-county area.

The number of foreclosures in Charleston and Berkeley counties jumped to 638 this year from 425 in the same period last year, a 50.1 percent increase.

Dorchester County, which reports the number of properties set for county auctions rather than foreclosure filings, saw a 53.8 percent increase from the same period last year.

Taxing situation

Want to see a smaller property tax bill? If you bought property recently, I suggest calling your state representative. Senate lawmakers are now looking over legislation that would change the way recently purchased property is valued for tax purposes.

While the proposal is meant to tweak the property tax system over the long run, it has short-term implications for people who bought in Berkeley and Dorchester counties last year and in Charleston County in the last 18 months.

Two years ago, lawmakers passed a massive reform bill that prevents tax bills from escalating for longtime property owners.

It accomplished this by placing a 15 percent cap on assessed property values between the required five-year reassessment periods.

Translation: Say if your property was assessed at $250,000 during Charleston County's last reassessment in 2003, and its value grew to $300,000 over the next five years, the tax office cannot raise the assessed value by more than $37,500, or 15 percent.

The reform did not provide much relief for buyers, though. Anyone who bought property after Jan. 1, 2007, does not qualify for the 15 percent cap.

Not only that, their property tax bill for the following year would be based on the actual (typically higher) sale price.

That's where this legislation comes into play. Under the proposal, property taxes would not be based on the sale price until the next scheduled reassessment period.

If the bill passes, buyers in Charleston County won't see their tax rates change significantly until the fall of 2010.

The legislation would affect buyers in Berkeley and Dorchester counties in 2009.

The bill, H. 4942, was proposed by Rep. Bill Cotty, R-Columbia. It passed quickly through the state House of Representatives.

High marks

Daniel Island developer Frank Brumley was honored this past weekend as a distinguished alumnus of the University of Georgia's Terry College of Business.

The award recognizes career achievements and community service.

In addition to Daniel Island, Brumley has had a hand in planning other major communities, such as Kiawah Island, Wild Dunes and Amelia Island Plantation. Brumley graduated from the Terry College in 1962 as a finance major.

Reach Katy Stech at 937-5549 or kstech@postandcourier.com.