I am considering applying for a home equity loan. In order to get the money I need, my house would need to be assessed at a higher value than it currently is because I have very little equity in the house. However, I have made many major capital improvements, so this won't be a problem. If the bank's assessor assesses the property at a higher value, will my house be subject to higher property taxes? I live in NY, so the property taxes are the highest in the country, and this would be a major problem.
I have considered and researched other alternatives to a home equity loan, so I just need to find the answer to this question. I can't seem to find it on the Internet, and I have asked two mortgage people...and they don't even know.
2007-01-26 01:44:04 · 10 answers · asked by Anonymous in Business & Finance ➔ Renting & Real Estate
OK, if my property tax is based on the value of my property...let me pose this question/example:
Say, I bought my house for $170,000 and put no money down. My house is currently assessed by the town/county at $200,000. That is what I pay property tax on. Between rising property value and tens of thousands of dollars in capital improvements, say my house can be assessed for $250,000. That would be $70,000 more than the remaining principal. Excluding any other data or costs, a 100% home equity loan would provide me with $70,000. Now, if someone came out and said my house was valued at $250,000...this wouldn't increase my taxes? So...the town/county would not find out about this loan or the re-assessment? My tax rate here is 3.5%. I have to be 100% sure.
2007-01-26 01:58:52 · update #1
Not necessarily! Because the bank's appraisal with the new value is not shared with anyone......also, typically, property taxes are assessed when there is a transaction on the property and unless you need the county's building dept. approval, you should be fine...
2007-01-26 01:49:06 · answer #1 · answered by boston857 5 · 0⤊ 0⤋
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2016-04-21 20:25:38 · answer #2 · answered by ? 3 · 0⤊ 0⤋
your property tax will not raise until the county assesor raises the value of your home. The only thing that you need for an equity loan is an appraisal value that says you have equity. To get this, you don't have to go through the bank that you are getting the loan from. You can pay any licensed appraiser to do it for you
2007-01-26 01:53:33 · answer #3 · answered by anicarelaford 2 · 0⤊ 0⤋
A home equity loan will not increase your property tax. Property tax is based on what the county assessor decides your house is worth, not what the bank has decided your house is worth.
2007-01-26 04:10:35 · answer #4 · answered by RN 2 · 0⤊ 0⤋
Having an equity loan doesn't make one bit of difference on your taxes. Just because you spent the money before selling, doesn't mean you didn't realize a gain at the time of sale that is taxable now. The only legal way to defer taxes on capital gains on real estate is a 1031 exchange, or to live in the home as your primary residence for 2 of the past 5 years, at which point the first $250K in profits is tax-free if you're single. $500K if married. Your idea simply doesn't work.
2016-05-24 01:42:28 · answer #5 · answered by Anonymous · 0⤊ 0⤋
I certainly would not think it would. The amount of money that you can borrow is based on the appraised value of the home. The only way the value would go up is if it were appraised higher then it's current appraised value. As long as you don't borrow more than the current appraised value, then your taxes won't go up. If you happen to get appraised for more then the current appraised value and your county tax appraiser finds out about it, then they could possibly reasses your taxes based on the new appraised value.
To verify this information, I would call your county tax appraiser's office to see how they handle this.
2007-01-26 01:58:17 · answer #6 · answered by Realtor Jim 2 · 0⤊ 0⤋
Property taxes are based on what the state or locale assesses your house at, not what the bank does. Private assessors often assess your house at its market value, while assessors for tax purposes use a different formula.
2007-01-26 01:51:21 · answer #7 · answered by M O 6 · 0⤊ 0⤋
No. The taxes are generally on 1/3 of the market value of your home in most areas. The taxes are never taken from the existing liens on the home.
2007-01-26 01:58:12 · answer #8 · answered by rogers_andrew 3 · 0⤊ 0⤋
No...your property tax is based on the value of your property.
2007-01-26 01:50:10 · answer #9 · answered by Anonymous · 0⤊ 0⤋
thank you! Extremely valuable information and it offers me better insight on this subject
2016-08-23 16:15:36 · answer #10 · answered by Anonymous · 0⤊ 0⤋