Property Taxes: Frequently Asked Questions - Quicken Loans Zing Blog

Title Source is one of the largest providers of title insurance, property valuations and settlement services in the nation.

When refinancing or purchasing a new home, one of the items that a title company researches are the property taxes. Although every homeowner pays property taxes across the county, determining your specific property taxes has many variables. These variables coincide with different aspects of your home’s location and your home’s assessed value.  Depending on the taxing authority, your taxes could be determined by the city, county, school district or by all three. When you pay property tax each year, you’re paying for necessities that are provided by the city, such as police and fire department services, garbage pickup and snow removal.

How are my property taxes determined?

The amount of your property taxes is determined by the assessed value of your home.  When the market is healthy, home value increases and taxes do as well.

When are my property taxes due?

Depending on your taxing authority, your property taxes might be due annually, semi-annually or tri-annually. To find out, contact your taxing authority.

What happens if I forget to make a payment?

Just like many other collectors, there will be a monetary tax penalty for missed payments. Depending on how many payments are missed or how long the taxes are delinquent, you could end up with a tax lien on your property. Tax liens are imposed on property by law to secure payment of taxes. A tax lien may be imposed for delinquent taxes owed on a property, or as a result of failure to pay other taxes as well. While personal debt follows you wherever you go, tax liens on real estate stay with the real estate. The property owner becomes responsible for payment even if the tax delinquency was incurred by a prior owner. Tax liens can by paid in a variety of methods, even through an escrow account. Though procedures vary from state to state, there are usually several notices in addition to a fairly lengthy period of time before the property is seized and sold at a tax lien sale.

Does my lender pay my taxes?

Typically, you will pay property taxes into an escrow account (unless you request an escrow waiver) and your lender will forward the payment to your local taxing authority when it comes due. Property taxes and the interest you pay on your mortgage are usually tax-deductible.

During a refinance, will the prior lender or the new lender pay my taxes?

This question is commonly asked by clients when they are in process of refinancing. The answer is that it depends, but we’ll break it down and explain it as simple as possible: If the prior lender already sent out the escrow payment for taxes due but the payment is outstanding with the taxing authority, the new lender might still collect for taxes at closing. Consequently, when the prior lender’s payment is applied, the new lender will refund the client or reserve it in the escrow.

As a national title agency, how does Title Source determine each homeowner’s taxes in thousands of different cities?

Title Source is the largest independent provider of title insurance, property valuations, and settlement services in the nation. We have the necessary resources and an in-house database that provides us the taxing authorities’ information for different states, cities, and counties. Once we receive the property’s Parcel ID in a title order, we call the taxing authority to verify the property taxes.

What is a Parcel ID number?

Each property has a unique identification number called a Parcel ID and it is a numbering system that the taxing authority uses to keep track of properties and the corresponding taxes. The Parcel ID number identifies the property’s municipality, section or township range, the subdivision code, the block and lot numbers.  A parcel ID number can also be known as the property identification number (PIN), Assessor’s parcel number (APN), or Assessor’s identification number (AIN). The Parcel ID number can be found on the property tax bill and usually in the legal description of the subject property.

Any questions or comments? Please let us know!


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This Post Has 10 Comments

  1. We have several Lessee’s who live out of state, equipment is registered in Texas and equipment is located out of state. Should this equipment still be rendered in
    county where they live or where equipment is located?

    1. Hi Virgilla:

      In your case, I’m going to have to suggest your question go to a tax professional. I’m sorry.

      Kevin Graham

  2. PLEASE answer my QUESTION ASAP!
    I have a mortgage with you. My property taxes and home insurance are paid out of escrow.
    As you almost certainly know, the question has come up in connection with the new Tax Bill as to whether people may pay their 2018 property taxes before end of the year (2017) and then deduct them on their 2017 federal income tax. Whether states will accept the early payment apparently varies from state to state and county to county, but both my county and state will allow me to make this pre-payment– but I will have to make TODAY. to count as part of this year.
    If I do this, it will mean that you will not be using the approximately $6800 from Escrow for the Feb. 2 and August payments of my property owner’s tax. So if I go down to the tax office today and pay, can I retrieve this amount from you, out of my escrow account?? If not, can I apply this money to an additional mortgage payment? Please LET ME KNOW! And please — ASAP!

    1. See the following. Thanks!

      “Quicken Loans has always paid property taxes by calendar year end (for clients whose loans we service and maintain tax escrow accounts) if the taxes are assessed and payable by December 31.

      This policy allows our clients to benefit from any tax advantages that paying property taxes by calendar year end may accrue to them.

      In the situation where a client’s property taxes are not yet assessed and/or billed, we would not ‘prepay’ property taxes since the amount due would be unknown. This is our policy regardless of the time of year.

      If a QL client elects to pay unassessed and unbilled future taxes, Quicken Loans will continue to collect monthly escrow deposits and make any unpaid property tax payments as they come due. If the client’s prepayment of their property taxes has caused there to be excess funds in their escrow account, the client will receive a refund of any surplus of funds after the annual escrow analysis is performed.

      Quicken Loans strongly encourages its clients to consult with a tax professional before making any ‘timing’ decisions related to the payment of property taxes that could result in substantial differences of overall income taxes owed and/or the timing of such payments, especially in a year, such as 2017, when significant changes to the tax code have taken place.”

      Jay Farner
      Quicken Loans

    1. Hi JoAnne:

      That’s an excellent question. I’m going to forward it to one of our Home Loan Experts who will be able to give you better information than I can.

      Kevin Graham

    1. Hi Jeffry:

      Every situation is different, but you may have some options. I’m going to have one of our Home Loan Experts reach out to get more information on your situation. Have a great day!

      Kevin Graham

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