Supplemental Taxes...What is this bill?!?

Supplemental taxes are something you should definitely know about if you're buying a home in San Diego! Often times realtors and loan officers fail to discuss this important topic with their clients, and homeowners are left confused when they receive an unexpected tax bill!

       When you purchase a home, the tax collector will reassess the property and 9 times out of 10 the property taxes will increase! The tax collector doesn't always get the tax bill updated in time though, so the regular tax bill that gets mailed out will be based on the previous owners tax amount. Then, the tax collector will create a supplemental tax bill, which will cover the difference between the current assessed value and the previous assessed value. Quick example, if the previous owners assessed value was $100,000.00 with a tax rate of 1%, they're annual property taxes would be $1,000.00 If you purchased it and it was reassessed at $150,000.00 you're annual taxes would be $1,500.00 so the difference would be $500 and that is (approximately) what you could anticipate your supplemental bill to be for! This doesn't last forever by the way, it usually takes about a year to have it all corrected and updated on to the standard bill due in November and February!

       If you have an impound/escrow account with your lender, they will disburse payment for your property taxes out of that account. However, they might not even receive the supplemental tax bill, so if you receive one and you have an impound account, be sure to contact your lender and see if they plan to pay it or not! I would also suggest saving enough to cover that tax bill just in case your lender doesn't have enough in the impound account, it may be unlikely but you never know! Whatever you do...don't ignore it!!! If it doesn't get paid, you will be the one responsible for late fees! Yikes!

       As alway, if you have any questions about this post or homeownership in general, please feel free to call or email me!