Property Tax Funding Blog

No one likes paying taxes, but property taxes can be a real sore subject. On one hand, property taxes are essential to a city because they fund things like public education, transportation, and emergency help from police and firefighters -- all undoubtedly important to a city and it’s people. On the other hand, property taxes are based on the needs of a county.

In a recession, those budget needs can go up even though the economy is going down. Making up for those financial losses often means a hike in property taxes, even when property values have dropped. It can be heavy reading, but if you’re just getting to know property taxes, or you want to better understand them, this will give you a head start.

 Taxes get a bad wrap. And understandably! Property taxes are no exception. However, as much as we’d like to keep that money, our property taxes play an important part in the development and maintenance of our city. Emergency services, parks, libraries, and city transportation are all possible thanks to property taxes. They also provide funding for public schools so that they can offer children free education. Like ‘em or not, property taxes come with benefits.

On the whole, property tax rates have been increasing over time. The snapshot below shows the states with the highest property tax rates as opposed to those with lower ones. Ever wondered where your state stands? The bluer the state, the lower the tax rate and conversely gray signifies a higher rate. 

The idea of having your home taken away from you is a scary one but is a reality that many Americans face. In fact, as the date of this article, there are currently 925,356 properties in the U.S. that are in some stage of foreclosure (default, auction, or bank-owned)! Here are five tips on how to deal with and avoid foreclosure:

Texas residents are fortunate to not have a state income tax. However, that means the burden from property taxes is often quite high. Moreover, those taxes have increased by more than 200 percent in the past two decades, and are expected to go even higher.

Taxes are a fact of life, no matter where you live. While that is the case, Texas has a reputation for its status as a low-tax state. However, if you own property in Texas, you will find its citizens pay one of the highest property tax rates in the nation. Coming in at number 15, the average property owner will pay approximately $2,500 a year.

Increased Property Taxes vs. Increase in Household Incomes

Those in the Lone Star state know the only thing certain in life is death and taxes. However, for many real estate owners, skyrocketing property taxes have them scratching their heads. In Texas, when a borrower is delinquent on their payments, it sparks a series of severe penalties that can tack on an additional 48% of the delinquent tax bill in just one year. For many, climbing out of this additional debt is virtually impossible. Property owners find themselves facing foreclosure, bankruptcy or worse.

It’s no secret that politicians, banks and consumer groups have learned how to use negative press to their advantage when seeking to sway public opinion about a particular issue. And within the state of Texas, they’ve spent alot of time, energy and money trying to change the public perception of the entire property tax lien process and especially companies like ours (link to home page) that offer property tax loans.

But with so much effort spent trying to change public opinion on this subject, why is it that Texas lawmakers continue to stand behind the concept? The bottom line is that these loans are handled in an ethical manner and have a tangible benefit to consumers.

Although some have tried to cast Texas property tax loans in a bad light, they’ve only grown in popularity in the last six years. In 2008, just 8,949 people received this form of assistance to help pay the taxes owed on their property. However, just three years later, 12,686 had benefited from these lien transfers. While there are plenty of ways to help explain these numbers, the impact of regulation, licensing and competition has certainly played a role.

A Brief Introduction to Texas Property Tax Loans

Let’s begin with a quick overview of what these loans entail. To be accurate, they’re not actually loans at all. Instead, they’re lien transfers. When someone finds themselves severely delinquent on their taxes, they don’t face too many options. They can try to raise the money on their own, but the amount is often thousands of dollars. In fact, the average lien transfer in 2013 was for just over $12,000.

Making matters worse is that the property owner is also faced with mounting interest, making each payment they miss all the more difficult to pay off. On top of that, if they don’t get the money they need in enough time, they could lose their property to foreclosure. With a lien transfer, those in trouble can transfer the property tax obligation on their property to a lender as collateral and, in return, the lender will pay off their tax debt. The borrower then has years to pay off the amount, generally in monthly payments.

It’s no secret that the entire nation—the entire world, really—has taken a beating over the past seven years where the economy is concerned.

While many of us accepted the challenge of hard times and watched as entire companies and banks fell, a lot of people had to deal with the recession much closer to home. Millions of people lost their houses due to foreclosure and countless others had to hand over their commercial buildings for the same reason.