A history of Baltimore ground rents, courtesy of guest blogger, David Kramer of Castle Title.
This is the first in a series of three he will be sharing about the reform the Maryland Legislature is putting into place because there are so many Baltimore ground rent issues.
Thank you, David!
A little over three years ago, the Maryland Legislature made some sweeping reforms to ground rents in Maryland. This came as a result of a series of articles that the Baltimore Sun ran about some people who lost their homes in “ejectment” actions for failing to pay their ground rents. The annual ground rents in question in the matters reported by the Baltimore Sun were all under $100. So, the Baltimore Sun worked to defend homeowners who failed to pay their ground rents from losing their home and right what it perceived as a gross injustice.
To put things in prospective, one needs to understand that ground rents date back to the eighteenth century England where initial homeownership costs were kept low because the buyer only paid for the building and rented the land at a fixed cost. If the buyer failed to pay their ground rent, the landlord – through an ejectment action – could reclaim the property and the building on it free of any mortgages, judgments, or lies on the property. For complete history on ground rents in Maryland, please read http://www.rosspartners.com/ground_rent_article.pdf .
Fast forward three hundred years, and we now have a system where tens of thousands of Marylanders own homes with no idea whatsoever who owns the land under their house. And, because home owners have no idea who owns the dirt beneath their feet, they have no idea who to pay their ground rent to…that was until they got served with an ejectment action by their ground rent to reclaim the property and it was all but too late.
Here is an episode of Castle Title TV on ground rents. Next time, David will discuss Maryland Legislature’s 2006’s laws prohibiting the creation of new Baltimore ground rents and banning ejectment actions by Baltimore leasehold owners.