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We paid $185k for our lot & built a house in '98. We refi'd in '03 and rolled in consumer debt, and that brought it up to $230. It's now down back where we started, around $185k.
We took out a home equity loan in '06 for $35k (now at ~$23k)
Our primary mortgage rate has been 6% since '03. Property taxes have almost tripled since we built and are now over $7k. Our monthly payment is $1,900.
Bank has been the same small community lender all along. We like that we are known by name, and don't want to refi with anyone else.
Bank says pay the appraisal and take your chances, but they seem doubtful that our place would appraise at more than 20% above current outstanding loan balance. Property values plummeted here in the recession and have not recovered. Lots of foreclosures etc.
We're dying' here! Well, not really, but I feel like we're losing so much money every month and I don't see a way out.
At the same time, it outrages me that our property tax is so high, so I'd love to get that reduced.
I am not really savvy on any of this; are there things we can do to "up" the appraisal? It's a pretty unique place, and I know lots of people say that, but in our case it's really true. Six acre flag lot in a private development of standard lot sizes, with 900-plus feet of creek frontage, and nobody else has a lot this big and nobody else has the waterfront we do. No comps that I know of.
House is nothing special, however. It's a raised ranch, 4/2.5. One major negative is because it's on a hill, one side of the lower level is below grade (ONE SIDE, other three are above grade), and so in the past (2003) the lower level, with 2BDR, 1B, was considered basement and those rooms weren't considered as part of the house. Really messed up, IMHO.
Not sure what to do here. I'd rather not risk ~$400 if there's no chance of coming in 20% above $208k (outstanding house debt) .... but have no idea how to be more certain.
What's your goal? Reduce the interests rate or reduce your monthly payment? Is this a case where you can no longer afford to live where you are with the high property tax? What's the appraisal value based on tax? I know in most cases, appraisal is different than market but lots of jurisdiction has gone with FMV so they are actually very close.
We can still afford to live here -- barely -- but it sticks in my craw that we pay so much. Leaving isn't really an option, more's the pity.
The appraisal value has not changed since we built. (It's a multiple of, like, $34k. That's obviously not the appraised value but I have no clue how they come up with the number. We are in the Northeast, so it's millage-based... is that even useful information for you? Sorry again for my ignorance.)
Anyway, the prop tax is all school tax. There's no way to avoid it, and the school district is hopeless and it won't get better. They had a huge influx of residents at the turn of the century and built a ton of new schools, and now the residents have left and they're stuck with monstrous debt and empty buildings and blah blah blah. Horrible situation and no way out.
ETA - found last year's bill. Land assessed at $10k. Building assessed at $26,440. Same since we built.
School district millage rate was 138.72 in 2007 and proposed 2015-16 budget is 179.38. As you can see, it just keeps rising.
Last edited by Gettingouttahere; 02-26-2015 at 07:22 AM..
Not sure if that is going to be possible if a large percentage of your monthly is taxes. Are you utilizing the school? If not, staying doesn't make sense. If on the other hands, you have kids in school then think of the taxes as cost of the education. I am in NJ so I know what is like with high taxes. I have kids in public school so I find it reasonable. Once they are in college, there is no way I am going to stay.
We send both kids to private school. The district is awful. Corrective action label in the NCLB program. Yuck. I would leave if I could but there are other factors that make it pretty much impossible.
Sigh.
Yeah, a huge percentage is the taxes. If we got the interest rate down to the 4% range, taxes would probably be HALF the monthly payment. That's close to criminal.
I know your situation in Jersey; it's barely better here (eastern PA). We moved here because taxes were so much lower in the 90s. But everyone else had the same idea, and the schools couldn't cope. I wish we could just walk away.
We paid $185k for our lot & built a house in '98. We refi'd in '03 and rolled in consumer debt, and that brought it up to $230. It's now down back where we started, around $185k.
We took out a home equity loan in '06 for $35k (now at ~$23k)
Our primary mortgage rate has been 6% since '03. Property taxes have almost tripled since we built and are now over $7k. Our monthly payment is $1,900.
Bank has been the same small community lender all along. We like that we are known by name, and don't want to refi with anyone else.
Bank says pay the appraisal and take your chances, but they seem doubtful that our place would appraise at more than 20% above current outstanding loan balance. Property values plummeted here in the recession and have not recovered. Lots of foreclosures etc.
We're dying' here! Well, not really, but I feel like we're losing so much money every month and I don't see a way out.
At the same time, it outrages me that our property tax is so high, so I'd love to get that reduced.
I am not really savvy on any of this; are there things we can do to "up" the appraisal? It's a pretty unique place, and I know lots of people say that, but in our case it's really true. Six acre flag lot in a private development of standard lot sizes, with 900-plus feet of creek frontage, and nobody else has a lot this big and nobody else has the waterfront we do. No comps that I know of.
House is nothing special, however. It's a raised ranch, 4/2.5. One major negative is because it's on a hill, one side of the lower level is below grade (ONE SIDE, other three are above grade), and so in the past (2003) the lower level, with 2BDR, 1B, was considered basement and those rooms weren't considered as part of the house. Really messed up, IMHO.
Not sure what to do here. I'd rather not risk ~$400 if there's no chance of coming in 20% above $208k (outstanding house debt) .... but have no idea how to be more certain.
Thanks for any guidance...
You don't need it to appraise for 20% over the $208 (unless you were trying to roll your 1st and 2nd mortgages into one loan). Your new loan can have a maximum LTV of 80% and a combined LTV (CLTV) of 95%. So if you think you can get it to appraise for $220k, you will be able to refinance that 1st mortgage. The 2nd will stay in place. The second mortgage holder will subordinate.
You could also do a HARP loan (assuming your current 1st mortgage is held by Fannie Mae or Freddie Mac)(it probalby is), you can refi your 1st mortgage no matter what the current appraised value is. If you go this route it is likely they won't even have to appraise the property at all.
You should get on this right away to take advantage of today's low rates!
ETA - found last year's bill. Land assessed at $10k. Building assessed at $26,440. Same since we built.
School district millage rate was 138.72 in 2007 and proposed 2015-16 budget is 179.38. As you can see, it just keeps rising.
Quote:
Originally Posted by Gettingouttahere
We paid $185k for our lot & built a house in '98. We refi'd in '03 and rolled in consumer debt, and that brought it up to $230. It's now down back where we started, around $185k.
.
Wait, so your assessed value is $36,440, but your actual value is in the $200k range? That's very counter-intuitive to me. In my area, and in most areas from my understanding, the assessed value is intended to be within a few percent of the actual value. I suppose it doesn't really matter, since they adjust the mil to compensate, but I've never heard of anywhere where the assessed value wasn't at least in the general ballpark of the actual value.
Also, if you hadn't pulled $80k out of the house for other uses, you could easily do the refi now. I assume on the consumer debt, you were paying more than the 6%. So you may not like your current payments, but if you hadn't taken the money out to pay off other debts, presumably your total debt obligation would be even higher than it is. Think of it that way. You have, and are continuing to save money by having paid off the consumer debt.
Yeah, I don't begin to understand how the assessed value thing works here, but it's pretty common for it to be a very low number, kind of like a fraction of the real assessed value.
It was never $34k as a real assessed value. It's not *that* bad here
For all I know there's been no county or township wide reassessment in 30 or 50 years. That might account for it.
And yes, the addition of the consumer debt did, and continues to, make sense.
So that makes it a bit easier to stomach, you're right.
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