Mortgage Payment Jumps 27%

Discussion in 'After Hours Lounge (Off Topic)' started by Michael*K, Dec 8, 2003.

  1. Michael*K

    Michael*K Screenwriter

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    It's that time of the year when my mortgage company sends out the annual escrow disclosure statements. I was kind of bracing myself when some of my friends and family in the area said their mortgage payments were going up next year. Still, I was floored when I opened my disclosure statement and saw that my payments next year would be going up a whopping 27%. Why, you might ask? After all, I have a fixed interest rate and my homeowners insurance costs have been pretty steady from year to year. Well, it turns out my property taxes are going up a staggering 46%!! Why? Because gross mismanagement in the school district that I live in has cost the taxpayers dearly. Basically the elementary school district was allowed to engage in deficit spending unchecked for over five years. Last year the district was, for all intents and purposes, bankrupt. It was on the verge of shutting its doors nearly overnight when the governor stepped in and passed an emergency spending bill that got the district's bills paid through the end of the year. And oh yeah, the district also had to take out a $4.5 million loan to pay interest on previous debt! And who got stuck footing the bill for those two loans...myself and all the other residents. Although I don't have kids, I'm all for paying my fair share for education...it helps fund the future. But the fact that politically appointed officials were allowed to run rampant over a school district's financial books for five years really makes my blood boil. I wish I was in a stronger financial position so I could move. [​IMG] Sorry...I just had to vent. [​IMG]
     
  2. Devin U

    Devin U Second Unit

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    Athough it most likely wont make you feel better, think of it as paying a student loan on your K-12 education.
     
  3. alan halvorson

    alan halvorson Cinematographer

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    That's quite a jolt - I feel for you - although had your school district been more fiscally responsible, you probably would have been paying a little more the past few years anyway.

    Here in Minnesota, we get to vote on school funding. In fact, I'm voting on Tuesday on one such funding request. I'm voting for it, but it's not likely to pass and the school district will be forced to cut its budget again.
     
  4. Christ Reynolds

    Christ Reynolds Producer

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  5. Mark Romero

    Mark Romero Second Unit

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    Yep, I got my tax notice and escrow statement in the mail within 2 weeks of each other. My payments were going to go up $30 per month until I called the mortgage company and said my tax was less than predicted and my homeowner's insurance also went down. So I ended up saving about $10 per month on my house payment.
     
  6. Scott Merryfield

    Scott Merryfield Executive Producer
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    We used to experience similar huge property tax increases in Michigan. However, many years ago a law was passed which capped the amount that property taxes could be increased each year at basically the rate of inflation, regardless of how much your property's value increased during the year. When you sell your property, though, the next owner gets taxed at the new, higher assessed value. Any new millage increases must be approved by the voters.
     
  7. Bryan X

    Bryan X Producer

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    How much is your property tax per month and how much is your total mortgage? For a 46% jump in property taxes to increase your total mortgage by 27% your property tax would have to be over half of your total mortgage payment.

    So you pay more in property tax each month than you do in principal/interest/insurance each month?
     
  8. Michael*K

    Michael*K Screenwriter

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    Actually that was a calculation error on my part. The property taxes are actually making a 56% jump, which is even worse. And principal & interest is getting perilously close to my escrow amount (taxes & insurance.) After January 1, it will be a 52/48 split. This year it was 67/33.
     
  9. Patrick Larkin

    Patrick Larkin Screenwriter

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    Seems like your tax rate should have been hiked much earlier! Schools need to spend money. After all, the federal government is demanding more and more with its "No Child Left Behind" programs. Districts are required to show data about students and to collect such data cost money. Smaller districts are buying turnkey data warehousing products and larger districts are hiring technical personnel and buying equipment. Parents are demanding that districts train their children on technology which also costs money. The workforce is getting older and more and more retirement and medical benefits are being paid. Districts cannot recruit good people because taxpayers demand that their benefits be substandard.

    Running a school district is very expensive but more carefully managed tax increases should have eased the blow. Federal cuts in public education also don't help matters.

    By the way, do you live in a suburban area? Tax rates were real high when I lived in a more urban location becuase there were a LOT of students but a small tax base.
     
  10. nolesrule

    nolesrule Producer

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    Our taxes went down $3 this year. [​IMG] Unfortunately, we just bought the house, so it will be reassessed for next year and I expect it will increase by nearly $1000, or close to $90/month in increased escrow payments. [​IMG]
     
  11. Ashley Seymour

    Ashley Seymour Supporting Actor

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  12. Steve Berger

    Steve Berger Supporting Actor

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    If it's any consolation your big jump should scale back by half next year. Because of the timing of property taxes and rules for lenders they (the lenders) have to recover the escrow shortage (from making an unplanned increased tax payment) within one year . In other words half of your increase was for the new rate and half was makeup for the previous year. Next year they will just collect the new rate unless Rod does something else to us.
     
  13. Kirk Gunn

    Kirk Gunn Screenwriter

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    If you folks think most of the tax increases are going directly into eduction, then I've got a nice bridge near Manhattan for sale....

    Education is merely the "cause of the day" to hit the homeowner rather than fix the problems. Since all they do is raise the assessed value of your home, not the rates, it's a double win for the pols. They take more $$$ and still come around next election period and claim "we have not raised tax rates !".
     
  14. Bryan X

    Bryan X Producer

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  15. Philip Hamm

    Philip Hamm Lead Actor

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    This is why I vote "no" on every bond referrendum I ever see. If the government can't come up with the money to pay for (insert cause here) out of their regular taxes, I don't want my future taxes paying interest on debt incurred to pay for it. I don't think many voters know what the impications of municipal bonds are.
     
  16. Patrick Larkin

    Patrick Larkin Screenwriter

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  17. Philip Hamm

    Philip Hamm Lead Actor

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  18. Bryan X

    Bryan X Producer

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  19. Philip Hamm

    Philip Hamm Lead Actor

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  20. Bryan X

    Bryan X Producer

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