Buyer Resources - Articles

Buying Your Home - Property Taxes

Are taxes on second homes deductible?
Mortgage interest and property taxes are deductible on a second home if you itemize. Check with your accountant or tax adviser for specifics.

Do all loans require escrow accounts?
If you are taking out a FHA, Insured Conventional, or VA loan, the lender does require an escrow account to pay real estate taxes and home insurance premiums. Most conventional loans (20% Down) do not require an impound account.

Are property taxes deductible?
Property taxes on all real estate, including those levied by state and local governments and school districts, are fully deductible against current income taxes.

Where can I learn more about appealing my property taxes?
Contact your local tax assessor's office to see what procedures to follow to appeal your property tax assessment. You may be able to appeal your assessment informally.  Mostly likely, however, you will have to go through a formal tax-appeal processes, which begin with an appeal filed with the appropriate assessment appeals board.

How do property taxes work?
Property taxes are collected twice a year, May & November, and may be collected in an escrow account thru your mortgage. In Indiana your home will be capped at 1% of the assessed value of the home. Farm Land and Rental homes at 2%, and all others at 3%. Depending on your county they may assess your concrete patio and pool at 3% as well as any out buildings.

What is an escrow  account?
An escrow account is a trust account established by the lender to hold money to pay for real estate taxes, and mortgage and homeowners insurance premiums as they are received each month.

How is a home's value determined?
You have several ways to determine the value of a home. An appraisal is a professional estimate of a property's market value, based on recent sales of comparable properties, location, square footage and construction quality. This service varies in cost depending on the price of the home. On average, an appraisal costs about $300-$450 for a single family home. A comparative market analysis is an informal estimate of market value performed by a real estate agent based on similar sales and property attributes. We are always happy to do a CMA, just let us know.

Dan Moriarty
Dan Moriarty