What Homeowners Should Know About Tax LiensYour property tax can depend on a number of different factors. Depending on the size of your home, the value of your property, the location of your property and the school district you live in, you face paying thousands of dollars into your local, state and federal level. Some home owners have their taxes billed with their mortgage payment so they don't have to foot the bill at the end of the year in entirety. Those that do not use this methods might face unexpectedly high amounts for taxes and find themselves struggling to pay the amount by the dead line. This results in a Tax Lien being placed on the property in question. This is a very serious financial obstacle. Understanding the seriousness of a Tax Lien might help you avoid or resolve one. Prevention is certainly the key to avoiding this problem. Arranging to make monthly payments into a separate account will set aside the money you need when the bill comes around will certainly give you an advantage. If you can arrange to have your mortgage company to bill you an estimate amount each month with your mortgage payment, this is also another method. Sometimes, prevention isn't enough and some fail to make the payments required. This will result in a Tax Lien being placed on the property. Can you sell your home while it has a tax lien? Having a Tax Lien on your property will damage your credit so it's important to take care of it as soon as possible. Even though you don't feel the debt, a tax lien is a debt against your property and you may be required to sell the property to pay the debt off. If you intended to sell your home, the lien must get paid first before you are able to collect the remaining profit. The most effective but not always successful method to reduce or eliminate the Tax Lien on your property is to request a compromise. In some situations you can make a deal with the debtor to pay a fraction of the price as long as you do so in their time limit. Another method that can be proposed is a payment plan where you make an agreement to make monthly payments until the debt is paid in full. Find out about your state and county tax laws Know the tax laws in your State and County, since they are different in each region. Some States sell the the deed to your home to satisfy the debt (Tax Deed States); some sell the debt to an investor at high interest rates (Tax Deed Certificate States) and failing to pay that can result in a default and home loss; and finally some States sell your deed but allow you a timeframe to buy it back from the investor (Redeemable Deed States). |