When I buy a house, what kinds of taxes can I expect to pay in the long-terms? Can these just be included....

Question

in my monthly mortgage payment? This is for the United States.

Thankyou...

Answer 1

All jurisdictions are different in the number and amount of taxes. They are going to include local, county and state assessments as well as school, fire and police districts millages. In Texas they can vary by 1000s of dollars from one street to the next.

You are going to have to escrow both your real estate taxes and your property insurance. Taxes are generally paid in arrears and insurance is prepaid. Which means taxes are paid at the end of the year for the previous year and insurance is for the coming year. You are going to have to come up with funds upfront unless your mortgage lender is funding those amounts. The fees are prorated which means the seller will will be debited the amount of the taxes for the number of days that he owned the property.

Those fees vary year to year. They will seldom fall or stay constant. As a result you monthly payment may vary if you don't maintain enough money in the escrow account. For instance, my escrow account was depleted when my taxes and homeowners insurance skyrocketed. As a result, my payment jumped $200 a month to cover the shortfall.

Answer 2

I agreae with most of what's here but -

You need understand that there is no real average for taxes, insurance, mortgage insurance, etc. It varies from city to city and there is no real rhyme nor reason to it. Best to just check on it before you buy. Taxes will be easily stated in the listing, and some states (Colorado included) have a back door in case the insurance is much too high when quoted. I just read that Florida's rates just went up by as much as 100%, which may or may not be true (I don't know, I don't live there). Also, I've never heard of an excise tax - ask your Realtor before you buy.

Bianca is incorrect with the 80% loan to value idea. Some lenders require to escrow your property taxes and homeowner's insurance regardless of the loan to value. Others (very, very few) will allow you to pay your own taxes & insurance regardless of what you owe. Otherwise, she's right on the money.

Realtor Jim is right on that you need to check and make sure that all of the payments are made.

Sam has some great information.

New Mexico Real Estate Forms is a bit off base - you should always select your own property insurance agent. If the lender has to select one (this is rare, they just don't want the hassle) it will cost you anywhere from 50% to 200% more than it would if you find your own.

Good luck!

Answer 3

Your local/state property taxes can be included in your monthly mortgage payment. These funds are held in an escrow account by the lender for the express purpose of paying your taxes. You can also have your hazard (homeowners) insurance placed in escrow. Be careful with one thing though. Your loan will more then likely be sold to another company shortly after you sign the papers and quite possibly even before you make the first payment. It is very rare that a local lending institution will hold the note on your loan. You will know at closing whether or not your loan is being sold.

The point of this whole thing is that when the loans are sold, the information on the escrow payments may get 'lost' in the transfer. My neighbor found out after Hurricane Charley in 2004 that his loan had been sold just before the hurricane. Unfortunately the new lender did not pay the insurance premium and his insurance had been cancelled. Fortunately, after quite a bit of aggravation, he was able to get reinstated and his policy was back dated to before the storm.

The lesson here is that if you do escrow these payments, it is still your responsibility to check and make sure the payments have been made on time.

I hope this information has been helpful. If you have other questions, feel free to stop by my website at www.flwaterhomes.com.

Jim Reske, Realtor
ERA Advantage Realty, Inc.
Port Charlotte, FL

Answer 4

if you put less than 20% down payment, you are required to pay your property taxes and homeowners insurance with your mortgage. some programs may not . to simply calculate this payments you add your yearly tax and your insurance premium and divide by 12- this will give you the amount of your monthly escrow payment. this and your mortgage payment will be your total monthly payment. there is no other taxes to be paid unless you sell your home in less then 2 years and you have to pay capital gain tax.

Answer 5

Usually a mortgage company keeps an accont for you, and your paymetn includes the following:
*Principal and Interest
*Insurance (Varies, but usually $500-900 a year for an average home, so divide by 12)
*Property Taxes- You should be able to look up homes on the county site, or ask your realtor what the taxes are on a particular home. In my area, for an average home they are 1600-2500 a year, depending on the area-- so again, divide by 12)
*PMI (Primary Mortgage Insurance) If you owe 80% or more of the home's value (known as "loan to value" ratio) you'll pay this insurance. It varies from case to case, but you'll pay $50-150 a month for this.

Last, when you sell, you pay excise tax. In my area, its 1%.
If you dont own your home atleast 2 years, you'll pay income tax on the net profit.

Answer 6

Yeap, a lender usually includes property taxes and insurance in your payment. However sometimes it is better to get your own insurance company and have that payment taken out instead of having the bank choose one for you.