Real Estate Taxes 6 Months in Arrears in Cuyahoga County..What Does That Mean For Sellers?
Over the years I have found there has
been much confusion over what it means to be 6 months in arrears on
your real estate taxes, and what that means to you when you sell your
home.
In Cuyhoga county Ohio, and in many surrounding counties, we are typically billed in December and
June, with payments being due in January and July. In January of 2009
when we, (or our lender), paid our real estate taxes, we paid for the FIRST HALF of 2008. In July of 2009 when we, (or our lender), will pay our bill it will be for the SECOND Half of 2008.
What does this mean for you as a seller? If
your home closes this year on March 15th, you will owe for the last
half of 2008 PLUS January 2009 through March 15th 2009, approximately
8.5 months. If your home is going to close within days of the
due date for the taxes, it is best to speak with the escrow officer
handling your closing. He or she can tell you how best to proceed.
Many of you sellers pay your real estate taxes together with your mortgage payment.
The escrow officer must still collect what is owed at closing but it's
quite probable that you will get a refund after closing. It's a very
good idea to check the balance of your escrow account as there are
often shortages there due to an increase in taxes, in which case you
may not receive a refund or it may be substantially smaller.
In
the scenario above, (home closing on March 15th of this year) if you
pay your taxes on your own and not through your mortgage company, you will owe for 8.5 months, and likely would receive no refund after the close.
As
always, if you have questions regarding the payment of your real estate
taxes, consult your attorney or certified public accountant.
If you would like information on real estate values in your area, please contact Barb Szabo. I'd be happy to speak with you.