Property Tax Question---Now a little worried

[Stilltheone]

I read on another thread about someone not paying last year's property taxes and now I am worried.

We paid for half of this year's taxes, with the remaining half due on July 31st. That deadline has come and gone without us paying the rest (about $2500). We plan on paying the remaining throughout the rest of this year.

I called the county and asked if my mortgage company is notified that I didn't pay the other half and the woman told me no.

But, now I'm worried that my mortgage company will find out that I didn't pay the other half and make me escrow or increase my payment. What are my chances of them finding out??

[hereforinfo]

I am not an expert on this, and my only experience is from my neighbor's situation so take this for what it's worth. They were 2 years behind on their property taxes, and the lender did not find out until they did a title search to start foreclosure proceedings after they defaulted on the mortgage. The lender (countrywide/boa) paid the taxes at that time to clear the tax lien. I don't know if it slipped through the cracks or if they just do random audits or what, but in their case it was actually 1 year after the first tax bill became delinquent and a week after the next one had become delinquent.

When are your taxes actually considered past due? In my county, the taxes are due on Nov 1, but are not officially considered past due until April 1 of the following year. The earlier you pay, the bigger your discount so there is incentive to pay sooner. But technically they are not past due until April 1. Perhaps your county has a grace period as well?

[Stilltheone]

Our first portion of our taxes were due on January 31st, which we paid the first half. Our second half was due July 31st. So we are 23 days late on the second half.

When I called the county, we already had a fee assessed for being late.

I'm just curious why it matters to the mortgage company at all that the taxes are late/aren't paid. It has nothing to do with the security of their proprerty. It's not like I haven't paid my homeowners insurance, KWIM?

Worst case scenario is we will end up paying the other half in January, along with the entire amount for 2009 with our tax return. Hopefully, I can go under the radar for a few months.

I also wanted to add that my county doesn't start any type of "foreclose" proceedings until we are 3 years late. So, would there be a tax lien before then or would we just "be late"?

[jadams]

I'm just curious why it matters to the mortgage company at all that the taxes are late/aren't paid. It has nothing to do with the security of their proprerty. It's not like I haven't paid my homeowners insurance, KWIM?

The taxes need to be cleared to sell the property. So it diminishes the amount of money the mortgage company could recover from the property in a foreclosure and effectively the value of the property as security against default.

[goingcrzy]

We are behind too. (made the mistake of paying the loud and annoying cc companies and not the quite, local taxes. Call the county and ask to be put on a payment plan. We did this. When our mortgage company found out the we were behind they sent us a letter telling us that we had to be current or the mortgage company would pay the taxes. We sent them a copy of the payment plan and they were ok with that.

[hereforinfo]

Our first portion of our taxes were due on January 31st, which we paid the first half. Our second half was due July 31st. So we are 23 days late on the second half.

When I called the county, we already had a fee assessed for being late.

I'm just curious why it matters to the mortgage company at all that the taxes are late/aren't paid. It has nothing to do with the security of their proprerty. It's not like I haven't paid my homeowners insurance, KWIM?

Worst case scenario is we will end up paying the other half in January, along with the entire amount for 2009 with our tax return. Hopefully, I can go under the radar for a few months.

I also wanted to add that my county doesn't start any type of "foreclose" proceedings until we are 3 years late. So, would there be a tax lien before then or would we just "be late"?

I'm not sure, but you could probably find that information on your county's website. For my county, they place the lien on your property sometime after you become late, but long before they would foreclose.

The mortgage company cares because the tax lien takes priority over the mortgage lien, so if the bank ever has to foreclose they would have to pay the taxes at that time to clear the title. It jeopardizes their security.