4 Signs Your Mortgage Payment Is About To Go Up

By Laura Agadoni | May 25, 2016
A fixed-rate mortgage doesn’t guarantee that your monthly payment will never change. If you chose an adjustable-rate mortgage, it should come as no surprise when your mortgage payment fluctuates — that’s what “adjustable” means, after all. But how can you predict if and when your fixed-rate mortgage payment will increase? And did you even know that it could? Although your monthly payment with a fixed-rate mortgage shouldn’t vary wildly, there are several reasons why it won’t always be the same either. The good news is that knowing this information helps you be proactive, enabling you to watch for signs that your payment could increase. 1. It’s property tax assessment time Most things that go up must come down. But this isn’t true for everything — our age, for one. And there’s something else that tends to go up and never come down: property taxes. “The downside to a strong real estate market is that taxes will inevitably increase,” says Josh Moffitt, president of Silverton Mortgage in Atlanta, GA. “If your home value increases because of market conditions, taxes will follow, and it will cost more to insure the home.” A great way to tell whether a tax increase might be on the horizon is to keep an eye on what neighboring homes are selling for by checking Trulia’s Recently Sold Homes. “When you see neighbors selling their house quickly or at a significantly higher price than what you paid for your home, it might be a sign that taxes are on the rise,” says Moffitt. “Each year, homeowners should receive an annual tax assessment,” says Greg Clevenger, a California real estate agent. “Simply dividing the annual assessment by 12 months to get the monthly amount will allow those of us who escrow our taxes and insurance to compare last year’s escrow account to this year’s.” If your property taxes increased, you might want to challenge your property’s assessment. “Every county has an appeal process for property value assessments,” says Moffitt. “When a home’s value is assessed too high and taxes subsequently increase, the homeowner can file an appeal in hopes of lowering the assessed value.” About 20% to 40% of people who challenge their tax increase are successful in lowering their tax bill. Also, make sure you’ve taken any tax exemptions available to you. “For example, if the home is your primary residence, ensure that you have applied for and are receiving the homestead exemption,” says Moffitt, adding, “Many states have senior-citizens exemptions, which cut taxes for homeowners at a designated age.” –
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