urchasing a home is both communities, property taxes can
an emotional and financial be significant and require some
decision. Part of the savvy budgeting so you do not get
financial decision requires you caught out when they come do. If
to consider mortgage payments, you are squeezing by on your
but don’t forget property taxes. monthly mortgage payment or plan
to, this can lead to unmitigated
Evaluating Property Taxes When nightmares since you do not have
Buying a Property the money available to pay the
property taxes. Remember, most
Most discussions and articles on communities require the payment
buying property highlight the of property taxes in a lump sum
need for you to ascertain what once or twice a year.
you can and cannot afford in a
property. The discussion boils Property taxes are dictated and
down to what type of mortgage you controlled by counties. To keep
can qualify for and the monthly things from getting out of
payments you can realistically control, state law typically sets
afford to make. Most people then a cap on the property tax that
throw in issues such as down can be assessed. As you might
payments, points and fees to come imagine, each county charges
up with overall figures. different rates. In general, you
Unfortunately, there is one other should expect rates from one to
subject that needs to be included two percent of the total sales
in your calculations. prices of the property. For
example, the purchase of a
You are making a mistake if you $500,000 home in an area with a
do not take into account property one percent property tax rate
taxes when evaluating your would mean an annual payment of
financial situation. In some $5,000 in property taxes. If the
rate in your area is two percent, borrowers are forgetful or just
you will have to come up with fail to plan for the lump sum
$10,000 on the same home. payment, so they force you to
Obviously, it is vital that you plan for it. The only situation
look into this issue in your area in which a lender will not
and ascertain the exact rate. require this is if you put more
than twenty percent down.
How many people fail to take into
account property taxes and get in While buying a property is an
trouble? Enough people that emotional decision, the real
mortgage lenders habitually issue is your financial
require borrowers to pay property situation. When dealing with it,
taxes into an impound account as make sure you keep property taxes
part of their monthly mortgage in mind.
payment. Lenders know that
About the Author:
Raynor James is with http://www.fsboamerica.org - homes for sale by owner.
Read more articles by:
Raynor James
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