Hide the DeclineHat tip to Cobradriver for this unbelievable practice revealed:
This two-bedroom house at 1857 Prospect St. in Sarasota, bought for $453,900 in 2007, was just resold for $523,900. But the deal was a deed in lieu of foreclosure and no money changed hands. So why would a bank pay nearly $3,700 in stamp taxes?
The Herald Tribune has the story:
C&M had defaulted on a $408,500 mortgage, and Bank of Commerce was claiming its collateral. No money actually changed hands, according to Charles Murphy, the bank's chief executive.
Then why did the bank bother paying nearly $3,700 in documentary stamp taxes to make it look like the property had been sold for $523,900?
"The loan balance is the main consideration," Dart said. "That and any unpaid interest."