Property taxes and mortgage

750orbust · ‎07-03-2013

Hi all, I've got a question. I'm under contract on a house and the taxes on the house are based on the original from when the house was brand new. ($152,000) My lender told me to have my RE agent take a copy of my contract ($109,000) to the county tax office and have them re-access the taxes based on my contract since this is the true value (the amount someone is actually willing to pay). My realtor tells me that this cannot be done, that we must wait on our appraisal to do this but my LO disagrees and insist that this is normal.

Does anyone else have any experience in dealing with tax reassessment before an appraisal?

What I'm trying to do is get the taxes lowered just so my monthly mortgage payments will be lower and the house truly is in subprime condition but I know that it will still appraise for far higher than what I offered. I'm truly hoping for my appraisal to be really high because I plan on doing a home equity loan immediately after I close to cover home improvements but I don't want my property taxes to be based on my appraisal amount. I hope I explained that good enough. Thanks

StartingOver10 · ‎07-03-2013

No, you can't change the tax valuation based on a contract to purchase. Your LO is wrong. If s/he has seen it done before, then have him provide the exact, specific addresses, dates and contact person at the county so you can get it done too. Not going to happen based on the purchase contract alone.

austinguy907 · ‎07-03-2013

Hmm.... I was under appraised vs value / offer. Though once you take posession depending on your local rules you should be able to apply for something called a Homestead Exemption which will reduce your tax liability the following year. Check into that with the local tax office or on their website.

750orbust · ‎07-04-2013

I do plan on getting the homestead credit but this is an entirely different issue. My LO insist that I can take my purchase contract to the county assessors office and have them lower the taxes based off the amount I'm willing to pay for the property. He wants me to get this done before we close so the new tax rate can be factored into the escrow account. I'm so totally confused. I seem to agree with the first response that this is not possible but if it is I sure hope it works for me. I will contact LO tomorrow and have him tell me exactly where he has seen this done.

StartingOver10 · ‎07-04-2013

You might want to be more dipomatic with your LO than my response! lol...

For what its worth, it sounds like what your LO is saying is that you have a DTI issue. Ask the LO why s/he wants this done prior to your official loan approval. You can correct a DTI issue by paying off other debt used in the calcuation of your DTI. However, that won't work if the LO says your front end ratio doesn't meet guidelines (it appears that may be an issue from your post). If that is the case, and you have room in the back end, see if you can get a waiver for the front ratio. Do you know what your ratio's are?

I only mention this because the tax reassesment occurs after purchase, not after contract. The lender will change the escrows once the tax amount changes - they do this annually. So it is really unusual for a LO to ask you to change an assessment prior to closing. (I don't really think it can be done prior to closing either).

GL.

750orbust · ‎07-04-2013

He's wanting me to do this simply for my own good, to make my payments just a little bit lower (although not by much). My current DTI is not an issue. It's only 7%. My payments are estimated to be about $750. I asked the LO what I could do to get my payments to $700 or below and this is what he told me to do.

750orbust · ‎07-04-2013

Maybe I'm not understanding him correctly, but nonetheless he's still wanting me to take care of it now but from what you're telling me, nothing can be done about taxes at this point. I'll have to find out again exactly what the heck he's talking about because right now even my realtor is scratching her head.

pdog661 · ‎07-05-2013

You can not fight the taxes until you take legal possession of the home.

You could request the seller dispute the taxes, but this normally takes over 60 days.

Simple ask for an escrow evaluation when the forms is sent to you and you should be good to go.

austinguy907 · ‎07-05-2013

The only benefit of reducing the taxes for 2013 would be the amount you pay back to the seller for the remainder of 2013. If the LO is so concerned about it then you should tell them to do it for you as a value added service free of charge. I've never heard of this before and think your LO is full of it.

mygoal750 · ‎07-05-2013

I live in Nebraska. In our county, we can only dispute our tax assessment once a year, in June. Have you checked your county assessor's website? Sometimes, they will have instructions to follow to dispute your assessment. In my case, I had to submit comparable properties and why my house isn't worth as much. Most had more square footage, and amenities I don't have (vinyl siding, underground sprinklers, etc.). I gave my argument and got my valuation, and thus my taxes, lowered in 2 instances. But, we only have a one month period to dispute valuations. If I were to buy another house in the county I live in now, I wouldn't be able to dispute the valuation until next June.