Davidson Realty, Inc.

SURPRISE! You Now Owe…

June 18, 2010

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Posted by in News

You close a brand new home mid-year that was still under construction on January 1st when the county assessed the house for the current year. Obviously, the house is not going to appraise at fair market value because it is not finished. Unfortunately, many people aren’t aware that your payments are about to sky rocket.

Your escrow company requires a monthly payment based on the current home assessment (or a prior year tax assessment), but it is an unfinished home, so the amount may be based on just the fair market value of the home site alone. When the home is completed and the new tax year arrives, the value of the home on the tax roll will change to the current assessed value by the tax appraiser.  Therefore, this will be a higher figure than the property was assessed for in the previous year. The homeowner’s mortgage company will get the new assessment from the tax appraiser and will increase their payment according to the increased assessed value. Read more

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