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Understanding Property Taxes in Colorado Springs

By in Buying

Many home buyers and sellers in Colorado Springs become confused when it comes to property taxes. Hopefully this post will help clarify how property taxes are paid each year for a Colorado Springs home.

Property taxes are paid in arrears. You actually pay your 2008 property taxes in 2009 since taxes are paid for the previous year. Most homeowners’ property taxes are figured included in their monthly mortgage payment and the monies to go toward property taxes sit in an escrow account.

Normally, property taxes are paid out of the escrow account twice a year; at the end of February and mid-June.

When buyers in Colorado Springs purchase a home, the sellers are required to credit buyers at closing, property taxes for the duration they owned the home (prorated per day) since the buyers will have to pay for the previous year’s property taxes out of their escrow account.

A Colorado Springs Realtor can provide a home seller with an estimated net sheet of seller closing costs including the property tax proration. Although sellers pay the prorated property taxes at closing, any money leftover in their escrow account for property taxes or hazard insurance should be refunded to them by their lender after closing.

An important note for buyers: If the seller had a senior tax discount, resulting in lower property taxes, the buyer will only benefit from the discount until the next January and then be required to pay the full amount of the property taxes on their Colorado Springs home.

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