Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
My community has a glut of tax abated properties. As an example one home has a $250k value and will be paying taxes on a $101k assessment for the duration of the abatement. I assume that the purchaser at year 1 of the abatement was lender qualified on the $101k valuation's monthly tax payment amount.
What happens if I buy at year 8 of a 10 year abatement? What about year 7? Do lenders even look? In this case that would be going from a monthly tax escrow of $250/mo to $650/mo (if the current valuation stays the same) when the abatement ends.
I would imagine that many first time buyers would have qualified for less loan if the taxes were an extra $400/mo.
That's a great question. I would imagine the lender would just not even care. The current tax escrow is what they will use to qualify you. It's like condos with monthly fees. They could increase massively every year, but the lender just uses the current monthly fee for qualifying your debt to income ration.