Local Tax Payment

[WinnisquamZ]

Anyone read or hear about local tax payments? Most people pay their taxes thru their mortgage payment. If many are getting their payments delayed or pushed out, will Laconia or surrounding towns demand payment of taxes


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[joey2665]

Originally Posted by WinnisquamZ

Anyone read or hear about local tax payments? Most people pay their taxes thru their mortgage payment. If many are getting their payments delayed or pushed out, will Laconia or surrounding towns demand payment of taxes


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I seriously doubt you will see any municipalities extending payment due dates for property tax. In the highly unlikely scenario they do unfortunately those paying through escrow will not is a benefit. It would be too complicated for localities to communicate to mortgage company’s and then for the mortgage company to temporarily adjust payments.


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[Garcia]

Originally Posted by joey2665

I seriously doubt you will see any municipalities extending payment due dates for property tax. In the highly unlikely scenario they do unfortunately those paying through escrow will not is a benefit. It would be too complicated for localities to communicate to mortgage company’s and then for the mortgage company to temporarily adjust payments.


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My town in MA has made it clear that they are wiling to work with anyone who is struggling to pay taxes They also made it clear that people should contact the treasurer, ideally by phone rather then email, and establish a plan before the deadline has passed.

[joey2665]

Originally Posted by Garcia

My town in MA has made it clear that they are wiling to work with anyone who is struggling to pay taxes They also made it clear that people should contact the treasurer, ideally by phone rather then email, and establish a plan before the deadline has passed.

“Work With” is a very loose term. Will there be interest, deferred for how long?

I’m very pessimistic when a government agency says they will work with you especially when they can slap a lien on your house very quickly. Also as I said if it’s paid through an escrow the logistics are difficult.



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[Garcia]

Originally Posted by joey2665

“Work With” is a very loose term. Will there be interest, deferred for how long?

I’m very pessimistic when a government agency says they will work with you especially when they can slap a lien on your house very quickly. Also as I said if it’s paid through an escrow the logistics are difficult.



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It's a small, close knit town so what works here is not the same as what will work elsewhere. My understanding is they are willing to waive late fees and interest for a reasonable (not defined) amount of time. They are looking for at least partial payments and there must be a solid plan in place. The bottom line is they want their money; if they have to set up a plan to get it, they would rather do that than go the legal route after the fact. Escrow payments absolutely present an entirely different challenge, one that to the best of my knowledge has not been addressed (at least not publicly).

[P-3 Guy]

Originally Posted by joey2665

I seriously doubt you will see any municipalities extending payment due dates for property tax.

Brunswick Issues Emergency Order
Also Extends Tax Due Date to May 15th
Brunswick, Maine USA – March 24, 2020

...

The Town Council also voted to extend the property tax due date by one month to May 15th. The Town Council recognizes that individuals and families are struggling financially and this change is aimed at providing some measure of relief.

...

https://www.brunswickme.org/Document...-19-03-24-2020

[joey2665]

Originally Posted by TMI Guy

Brunswick Issues Emergency Order

Also Extends Tax Due Date to May 15th

Brunswick, Maine USA – March 24, 2020

...

The Town Council also voted to extend the property tax due date by one month to May 15th. The Town Council recognizes that individuals and families are struggling financially and this change is aimed at providing some measure of relief.

...

https://www.brunswickme.org/Document...-19-03-24-2020

Again but that is only going to work for cash payers not if it goes through escrow which the manor a majority of tax payments are made so the 30 days won’t help them.


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[P-3 Guy]

Originally Posted by joey2665

Again but that is only going to work for cash payers not if it goes through escrow which the manor a majority of tax payments are made so the 30 days won’t help them.

That's a valid point that it will be more difficult (although not impossible) for a homeowner who pays property taxes through an escrow process to benefit from a payment deadline extension. However, the main reason I responded was to show that there are in fact municipalities that are extending the payment deadlines ("I seriously doubt you will see any municipalities extending payment due dates for property tax").

Do you have any figures on what percentage of property taxes are paid through a mortgage processor escrow account?

[joey2665]

Originally Posted by TMI Guy

That's a valid point that it will be more difficult (although not impossible) for a homeowner who pays property taxes through an escrow process to benefit from a payment deadline extension. However, the main reason I responded was to show that there are in fact municipalities that are extending the payment deadlines ("I seriously doubt you will see any municipalities extending payment due dates for property tax").

Do you have any figures on what percentage of property taxes are paid through a mortgage processor escrow account?

I don’t but it’s a requirement if your mortgage is more than 60% of the value of the home as the banks need to protect themselves from a tax lien which would supersede their lien if there is a foreclosure. Of my clients that own home 90% pay taxes through their escrow.


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[P-3 Guy]

Originally Posted by joey2665

I don’t but it’s a requirement if your mortgage is more than 60% of the value of the home as the banks need to protect themselves from a tax lien which would supersede their lien if there is a foreclosure. Of my clients that own home 90% pay taxes through their escrow.

Not all lenders require that an escrow account be established, and some lenders leave the decision to use an escrow account up to the borrower.

The only loan programs that require an escrow account are the USDA and the FHA loan programs. Conventional and VA loans don’t mandate escrow accounts, but most lenders will advise you to have one if you are making less than a 20% down payment.

With a down payment of more than 20%, in most cases an escrow account is optional. The FHA and USDA programs are the exception, but most borrowers who can afford a 20% down payment likely wouldn’t apply for a FHA or USDA loan.

https://www.lendingtree.com/home/mor...scrow-account/

[joey2665]

Originally Posted by TMI Guy

Not all lenders require that an escrow account be established, and some lenders leave the decision to use an escrow account up to the borrower.

The only loan programs that require an escrow account are the USDA and the FHA loan programs. Conventional and VA loans don’t mandate escrow accounts, but most lenders will advise you to have one if you are making less than a 20% down payment.

With a down payment of more than 20%, in most cases an escrow account is optional. The FHA and USDA programs are the exception, but most borrowers who can afford a 20% down payment likely wouldn’t apply for a FHA or USDA loan.

https://www.lendingtree.com/home/mor...scrow-account/

Most lenders do especially when you’re borrowing more than 50% of the value of the home. Again I don’t want liens against the house from the locality as I said in foreclosure they will take presidents over the banks lien. I’ve never seen a bank and 80% of the value of the house and let you pay taxes on your own


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[P-3 Guy]

Originally Posted by joey2665

Most lenders do especially when you’re borrowing more than 50% of the value of the home. Again I don’t want liens against the house from the locality as I said in foreclosure they will take presidents over the banks lien. I’ve never seen a bank and 80% of the value of the house and let you pay taxes on your own

Your experience is not the same as my experience, or of others I have known who had mortgaged property. The 20% equity figure is one I have seen frequently used as the breakpoint at which an escrow account is no longer mandatory. It's generally considered that at that point the property owner has sufficient financial interest in the property such that there is an incentive to make sure that insurance premiums and property taxes are paid in a timely manner.

Anyway, and as I noted previously, the primary reason I initially responded was to indicate that there are indeed municipalities that have granted to property owners in this difficult time the courtesy of extending property tax payment deadlines.