Updated 07/26/2012 01:22 PM
Registers of deeds look to overturn Fannie, Freddie tax-exempt status
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GREENSBORO -- Five Triad-area registers of deeds are hoping to overturn the tax-exempt status for federal mortgage companies Fannie Mae and Freddie Mac.
The officials from Davidson, Guilford, Caldwell, Duplin and Davie counties sent a letter to North Carolina Attorney General Roy Cooper asking him to review the current practice. This move comes as a judge in Michigan ruled the lenders were not tax-exempt.
“We just want to find out if these entities are entitled to this exemption. If they're not, they need to pay this tax,” Davidson County Register of Deeds David Rickard said. “Fannie and Freddie are both publicly traded companies, they have a board of directors and a CEO. They're paying million dollar salaries and million dollar bonuses and they're claiming a government exemption that they're a government agency. I don't know many people in government that draw those kinds of salaries or have any kind of bonus like that."
And a recent ruling is giving them the open door they need to ask questions. A U.S. District Court in Michigan says the two are not tax-exempt.
“That case is on appeal, but what it does is raise fundamental questions about how that law is applied as it relates to them. That's what we're trying to do, is we want clarity around it,” Guilford County Register of Deeds Jeff Thigpen said.
They say the answers they get back from the attorney general will determine where they go from here, but one option could be to file a lawsuit for those back taxes. That could mean millions for the state and thousands for the counties.
“Well clearly, we've already lost a lot of money so what we would prefer to do is to go forward and reclaim some of that money.” Thigpen said, “Between Fannie Mae and Freddie Mac, I believe in Guilford County, that's at least $200,000 a year.”
But before that can happen, they'll have to wait to see what the attorney general finds.