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Prepaid property taxes on refinance: how many months should be paid at closing?

I am closing on a loan (refi) next week and the pre-paid taxes shown in the closing costs are the equivalent of 6 months. Is this typical? Considering the next installement is not due till April 10 in the county where I live, I wonder if that's normal practice. By that date I should have already made 4 monthly payments, so 2/3 of the tax amount due should be in the escrow account.
  • November 09 2009 - Cambrian Park
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Answers (3)

Best Answer

The next installment is due Feb 1, it is considered delinquent if not paid by April 10th.  Your escrow will be calculated off the due date.   So if close in November your first payment will be due Jan 1 and then 6 months of taxes will be due before you make your second payment.

6 months is correct for impounds on November closing.
  • November 09 2009
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willowmont, Justin is dead on , read his answer a couple of times. Escrow accounts have a cushion so in the month that the taxes are paid the escrow balance will not be 0, you will still have 4-6 months of taxes in your balance.  
  • November 14 2009
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Profile picture for lifebeyondEarth
Doesn't make sense for taxes in escrow for 4 month. Don't sign the paper. Get proper explanation from your title company. This is why you pay close to 200 to 300 to them, that they explain to you and get answers for you if they can't explain.
  • November 13 2009
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