Clear to close! *Update: CLOSED 06/06/13*

[Mike_B03]

As far as I know, taxes are paid once per year here. Is the escrow account supposed to be all paid up front or does money get deposited into the account each month you make the payment? They are only putting in $184.36 into the escrow account vs the GFE showed $1,159.98, seems weird.

Our original close date was supposed to be "mid to late June" but no specific date. We are closing on time with the date that we've had set for about 4-6 weeks I think.

The closing appointment is for 9:30 am tomorrow morning.

Thanks for all the help StartingOver10, really appreciate it.

[StartingOver10]

You are welcome.

Escrow has a starting figure that is based on the actual taxes and insurance and MI, if applicable, and then you contribute monthly in your payment. On your GFE it would show the proportion of the escrow account. It also should show the breakdown on your HUD1, look at the 1000 section labeled Reserves.

Here in my area the taxes are paid in arrears for the calander year. They are paid in November and you get a 4% discount if paid in November. So by this time of year there has to be ten months of taxes in the escrow account if you close in June. Insurance is annual based on the date you closed so two months in escrow is normal.

You will make it through this, hang tough with them.

[cclee]

Mike, they are paid twice a year, I think it's April and October?

[Mike_B03]

They are paid twice per year in AZ? No idea, but even so, it seems very low. On section 1000 of the HUD-1, it shows:

1001. Homeowner's Insurance: 3 months @ $39.34 per month - $118.02

1004. Property taxes: 9 months @ 22.18 per month - $199.62

1008. Aggregate Adjustment ($133.28)

All other fieds are blank.

On the last page of the HUD, it says "You have additional monthly escrow payment of $600.01." Not sure how that plays into it but the $184.36 they are putting into escrow now just seems off.

[cclee]

Congrats on your clear to close by the way!  It looks like they are basing the tax payments off of just the land assesment, since it's a new build it probably won't change until they do the new assesment in Feb., which would take affect in Sept of 14.

[Mike_B03]

Thanks cclee!

If they are basing the taxes off the land assessment and we won't have to pay the full amount until Sept 2014 like you say, how come we are paying $255 toward property taxes starting now? Should that not be a lot less until 2013 is over?

[StartingOver10]

The taxes for 2013 from Jan 1 thru June 30 are due Oct 1 2013 and deliquent Nov 1

Second half of the year, July 1 2013 thru Dec 31st are due Mar 1 and deliquent May 31,st 2014.

I think they are collecting the full amount because the first half of the year is up at the end of the month.

The house will probably be assessed for the full tax amount for the second half of the year, due Mar 1st

If you don't start paying the full amount then you won't have enough to pay the second half when due. check with the closer tomorrow before you close to see when the assessments are made on new homes. Here they go by c/o date but I'm in Fl not AZ.

[Mike_B03]

Thanks for all the research StartingOver10, much appreciated.

I guess the last point of confusion is why they show 9 months @ $22.18 for the property tax. So they are going by the assumption that the property tax will not increase this year to the full amount if I am interpreting it correctly.

[smiths38]

Congrats,enjoy your new home!

[foofighter74]

Congrats! Sorry you had to deal with all the confusion, but hopefully you'll get everything squared away and explained to you!