New builds are a bit different. I am in a new build, and since our property was dirt on 1/1/2016, and we closed on 9/25/2016, we only paid for 5 months of property taxes at closing for the cost of the dirt (3 months we owned the home plus our 2 month cushion required). This year, since the house was built by January 1, it's valued based on comparables.
I think it depends on how your taxing district does their valuations and timing, but our preliminary appraisals came out 5/2/17 for this year. The tax rates and values will be adopted later this year, and October tax bills come out. Escrow will have until January 1 to pay taxes without penalty, so some time between October and January, escrow will pay out and there will be a shortage of about $6,000. In March of next year, I will be asked to resolve the shortage.
Once or twice a year (once for us), your mortgage company will recalculate escrow and resolve any shortages. Call your mortage company and ask when they will recalculate the escrow. When this comes up, you can handle this 2 ways -
1. Lump sum pay the shortage + the amount to rebuild your escrow (usually 2-3 months of tax payments) and have your mortgage go up at that time to cover the amount of the new, ongoing payment
** In my example, property taxes are currently calculated at $1,200 yearly, because the mortgage company couldn't determine taxes yet. That is $100 per month in escrow payments. Now, I would need to make an escrow payment of $6,600, which would balance my escrow, and my payment would go up $448 a month (new $558 monthly payment minus the $100 I am already paying). This would bring my payment to $2,400 monthly.
2. Let it go and make up escrow shortage over the year. You would be paying towards replenishing for 2017s escrow shortage, as well as builging your escrow for 2018s tax year.
** If I was to do this, my monthly payment would go up to $2,958 for the next 14 months (1 years payments plus 2 month cushion), and then my payment would drop back down to $2,400 a month.
