I am closing on 10/27/16. The bill for my property taxes I believe came out around 10/1/16. Is the seller responsible for the first 10 months of this year? I don't understand how this works. Do they go from fiscal year to fiscal year? I'm thinking I am responsible for 2 months for this year. Would they take the seller's portion out of his money owed from closing and put it in escrow? I am also wondering about the HOA fees same scenario.
Are HOA fees ususally paid annually or monthly?
1. You are only responsible for HOA and taxes after you close on the property. So if the seller has prepaid any one of these through the end of the year, you will owe a prorated amount back to the seller (computed by days.) For example, my seller had paid the property taxes through the end of the calendar year. When I closed, he got a credit on the closing disclosure for the amount and it was added to my closing costs. The HOA works in a similar way. So in your case, you would be responsible for 2 months of property taxes plus 5 days in October.
2. Whether your HOA is paid monthly or yearly is dependent on the association and rules. In my experience the listing usually tells you whether the HOA will be paid monthly.
Just to add to Kats_rebuild excellent post:
The HOA dues may be monthly, quarterly, semi-annually or annual as stated in the financial statement for the HOA and set up by the original documents. The listing service may not indicate the right period because some MLS's force the agent to show the payment as monthly (like my MLS) when it is a quarterly payment (for example). The best source of the information is the HOA documents themselves, which you should have received at the time of contract. If you don't have a complete set of the HOA documents including the HOA financials, get a copy now.
Both HOA and property taxes are pro-rated to the day of closing. If the seller hasn't paid for either of these expenses, the closing agent will collect for them and make the payments as part of their standard post-closing procedure.