Property Management
Double Payment of Real Estate Taxes Causes Bureaucratic Headache
Question: Last November, I refinanced my property to a lower interest rate. At the time, the new lender required that my 2001 2nd half real estate taxes be paid. So the settlement agent collected six months of taxes to pay the county plus an additional two months to start the lender"s escrow account. Well, it seems that my old lender had already paid the taxes and now the county has been paid twice. A clerk that works for the county agrees that the taxes have been paid twice and they are holding $1,400 of my money. But they said they could only refund the money to the company who paid the taxes the second time. This was my settlement company. I"ve spoken with them and they simply say that they are working on it. I don"t think anyone"s working on it because it"s not their money and they don"t care. Can you give me any advice? Answer: I hate to say it, but this is a classic example of "the squeaky wheel gets the grease". I have experienced this issue before and you"re right - getting someone to do something when they"ve already been paid is like nailing Jell-O to the wall. What happened is pretty simple. Your taxes were probably due in November. The old lender paid the bill on time or a bit early to avoid a penalty. The payment was made out of your escrow account held by the old lender. When the new lender approved your loan, they also noticed that the county taxes are due in November, so they instructed the settlement company to make sure the taxes have been paid. The settlement company calls the county and the county reports that the bill is still outstanding. The settlement company, not wanting to violate the lender"s instructions, collects the money at settlement and pays the bill. The county eventually posts the first payment by the old lender and then cashes the second check from the settlement company. Now the county has $1,400 of your money floating around somewhere in the bureaucracy. This can happen because it often takes the county a long time before a payment is posted. Payments may have actually been received but not in "the system" so the person who answers the phone and looks up your account sees your taxes as unpaid. So the old lender makes the payment but the county doesn"t post the payment right away. So the settlement company is told that the taxes have not yet been paid. To exacerbate the situation, when both payments are finally posted, the county won"t simply write you a check to square up. What"s up with that? Here"s my advice: Call the county and talk to a supervisor. If that doesn"t work, speak with his boss. Call the settlement company and tell them that they erroneously paid your taxes and they need to get the money back. As I said, this is a "squeaky wheel" issue. If you press them hard enough, someone should be able to squeeze out your money from the red tape. To avoid this in the future, the best thing to do is take the bull by the horns. Contact both your lender and the county and make sure they have the same answer when ask them if the taxes have been paid and received.RES Course Provider commented:
I think before paying the taxes you must have idea about certain terms and conditions regarding it. For that you must obtain the advice of the professionals.
23.03.2012