Home Buying in 11756>Question Details

Bluebunny, Home Buyer in Dix Hills, NY

In a commitment letter I found out that our tax is over 2K higher than we were told and the # on the appraisal. What are my options?

Asked by Bluebunny, Dix Hills, NY Tue Jul 5, 2011

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Lydia Green’s answer
I agree with what has been said so far. What you didn't say is whether you still qualify for the loan with the higher taxes. If you do, there's nothing to do until you close. Probably the taxes reported on the multiple listing reflected exemptions that the current owner has. After you close on the house, you will need to apply for the STAR exemption. That gives you a reduction on your school tax. Everyone qualifies (unless you are buying a rental property) but you must apply for it. Your realtor can get you the application. There may be other exemptions that you qualify for, such as a veterans' exemption. Good luck with your new home.
0 votes Thank Flag Link Thu Jul 21, 2011
Bluebunny,

This question has legal implications. I would advise you to speak to your attorney to discuss this matter. Otherwise you are doing yourself a disservice. Good Luck!

John A. Weber IV
Associate Broker
Bayview Estates Realty
(516) 777-0146
0 votes Thank Flag Link Tue Jul 23, 2013
This is why I always call the town to get the true taxes for all of my buyers before they put in an offer. No surprises.
0 votes Thank Flag Link Tue Jul 23, 2013
Arlynn and the Century 21 broker are right. Usually, a good Realtor would call the town and verify the taxes. Too often a careless Realtor would assume the taxes that appear in his/her listing are correct, but they should have verified it with the town.

If you are thinking about backing out, you should sit and talk to your attorney who is best fit to advice you. Other than that, you're pretty much left with the option of grieving your taxes. Keep in mind, as mentioned below, you will not see any changes on your tax bill for the next year or so. good luck...
0 votes Thank Flag Link Wed Jul 20, 2011
While Ron's answer may be correct for California, it is not how the taxes are assessed here on Long Island. These taxes are a matter of public record and could have been checked by you, your realtor, your attorney, or any other person before you signed the contract to purchase your new home. These taxes will not increase because you have purchased and you will not receive a supplemental tax bill after closing.

If you are in contract, your recourse at this point is to wait until the next tax grievance period and grieve your taxes. Hopefully your grievance will lower your tax assessment and thereby lower your tax bill for both your school and county taxes. Unfortunately, even a reduction by this method will not lower your taxes for the current tax year or for the 2011-2012 year.

Regards,
Arlynn

Arlynn B. Palmer, ESQ, SRES, CBR, CMS, CNS
Associate Broker, REALTOR
Coldwell Banker Claire Sobel
Direct: (516)410-3594
Office: (516) 621_6300 x 205
Email: Arlynn@ArlynnPalmer.com
Web Reference: http://www.ArlynnPalmer.com
0 votes Thank Flag Link Tue Jul 5, 2011
I'm not sure how you do things in New York; but let me give you some info:
You want to, at least, be able to ask the correct questions.

Property taxes here are prepaid, six months in advance.
They are based on the last selling price of the property, (assuming that there have been no re-assessments).
When a house is sold, the Title company will collect the advanced taxes; they will collect from 1 month to the full 6 months tax, depending on the month of the year the escrow closes.
As I said the tax collected is based on the LAST selling price of the house; the Title Company will NOT collect from you, based on the NEW selling price, YOUR BUYING PRICE.
If you paid more than the last selling price, your taxes will increase.
And in 3 to 6 months you will receive a SUPPLIMENTAL TAX BILL for the difference.
This SUPPLIMENTAL tax will not be collected by your "Impounds Account"
Your Impounds Account will be notified of the tax increase and your Servicer will send you a letter notifying you of the higher PITI for the future.
If the property had not been sold in thirty years and the tax rate had been "grandfathered" in, (such is the case in California with Proposition 13), the difference could be substantial.
If you paid less than the last selling price, you taxes will decrease. (Hopefully!)

In California we are required to have the BUYERS sign a SUPPLIMENTAL TAX advisory, as part of the Documents.
The Title Company is not allowed to guess at the future tax.
The Appraiser has nothing to do with property tax.
The GFE (Good Faith Estimate) will have the old tax amount on it, (only)>

Now, the question is;
Does this apply to your situation?
Have I answered your question?

Good luck and may God bless
0 votes Thank Flag Link Tue Jul 5, 2011
First you need to talk to your attorney - the correct tax info should have come up when he ordered title/verified certificates of completion/talked to the seller's attorney. Then call your mortgage broker - they should have gotten the correct taxes to get you approved. Then call your agent and find out why the correct taxes were not verified for you - an easy thing to do. There is a lot of blame to go-around, more importantly: Let the buyer beware. Then try to grieve your taxes. Good luck with your new home
0 votes Thank Flag Link Tue Jul 5, 2011
You may have to file for a grievance with your town. Contact your local tax assessor.
0 votes Thank Flag Link Tue Jul 5, 2011
If you are in contract, there are no options. My suggestion is after closing, file a tax grievance with the town. If the purchase price is in line with the lower market, you may have a good basis to grieve the taxes.

There are many people who could have verified these taxes for you; your Realtor, your Attorney, but you also could have done it yourself; it is public record.
Web Reference: http://gailgladstone.com
0 votes Thank Flag Link Tue Jul 5, 2011
Your attorney can best advise as to any options you may have, consider a consultation....you can also check with the local tax assessor's office, you could file a grievance after closing, etc...
0 votes Thank Flag Link Tue Jul 5, 2011
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