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TAXES: Ease burden on underwater homeowners

Letter by Saundra J. Raynor, Lakewood on Sep. 22, 2011 at 4:21 pm with 7 Comments »
September 23, 2011 11:47 am

Older or disabled homeowners who would otherwise qualify for an exemption on property taxes are discovering that as their county assessor lowers the value on their homes, resulting in less equity (if any), they are less likely to qualify for exemptions.

However, since many of us are underwater ─ owing more on our homes than the assessor’s valuation (not an outside appraiser’s valuation, by the way) ─ we no longer have sufficient equity to qualify for an exemption or deferral on property taxes. A homeowner in this situation is exempt from property taxes only if his or her income is $35,000 or less annually. We in the middle are getting squeezed even more.

It is time for our legislators to amend the property tax law on exemptions to ease the burden on lower-income, older homeowners.

Leave a comment Comments → 7
  1. blakeshouse says:

    That is Wa socialism for ya.

  2. Your home is underwater because of the MARKET which inflated its value – the assessor didn’t make it happen.

  3. Or rather…..your home is underwater because you foolishly bought it with a mortgage you couldn’t afford at absurdly inflated costs and then it deflated to a more realistic valuing and, if you are on a fixed income, that was really, really stupid.

  4. slugoxyz says:

    Ok BB. So, let’s say a couple gets married back in 2004-2005. They go out to buy a house to start their life. The houses cost what they cost. Inflated? Probably but they cost what they cost. What should they have done? Rented a house and saved their money waiting on the bubble burst that no one predicted? No crystal ball? You are acting like everyone who bought a house did so without any thought process at all. Not all of us went out and got ARMs. Some of us got decent rates for 2005, put some money down and now find ourselves upside down. We pay all our bills and we’re still doing all right considering we don’t wish to move. So stupid? 6 years ago, I bought a house that I could afford and its value has dropped by more than $60K in the last 3 years. Lat year, we appealed and they raised our value $35K (we wanted to pay more in taxes). This year? They dropped it that $35K and added another $5. It’s almost as if they are laughing at us.

    Not the assessor’s fault? I understand the market fell and my house might not be worth what I paid for it but this is what the assessor doesn’t do. They don’t leave their office when they assess your house. They don’t consider improvements to your house from their office. Essentially, they don’t do anything but wave some ridiculous formula over your value and make it impossible for you to get a re-fi because your house isn’t worth enough. So, you are unable to better your position unless you can’t pay your bills. Then there are restructuring options. So, I am not completely blaming the assessor for the mess that careless financers, ignorant politicians and reckless, greedy real estate folk put us into. But for some of us, who keep our houses up, make improvements every year, the assessor owes us at least a hands on look. That’s their job. Just get off your butt and actually take a look.

  5. slugo – I guess I had a crystal ball…..I rented until after the crash because I thought the prices were absurdly high and didn’t seem sustainable (read: bubble about to burst). It was difficult to not jump in as it seemed like the Market was never going to slow down and, if we didn’t hurry up and get in, we would never be able to afford the spiraling costs.

    Refinanced last year – no points because I went through my Credit Union – our 15 year fixed rate is 3.75%. Our house is valued maybe $5K less than when we bought it 3.5 years ago (but then, the prices never went as sky high here as they did in the Puget Sound). So maybe, on this thing, I was smart….more likely, I was lucky.

    I guess there are advantages to living in SE Idaho – our assessor actually comes onto the property. Your situation does seem more than a little bizarre.

  6. itwasntmethistime says:

    slug — I don’t get what you’re saying. Why do you care what the assessor says your house is worth? You can’t use the tax assessed value to refinance your mortgage, you have to get an appraisal, and the value on the appraisal is based on recent sales data, not tax assessor data.

    Besides, the original purpose behind the tax exemption for senior citizens was to help the people who had lived in their houses for many years and paid them off, but then after they retired they couldn’t afford the rising property taxes. If you’ve lived in your house for a long time and you’re underwater it’s your own fault because your mortgage should be paid way down or even off by now.

  7. slugoxyz says:

    Itwasntme: Your first paragraph is true…to a point. You have to get an appraisal and get “comps” in order to refinance. Comps unfortunately are based on what houses are sold for and similar to your house. So, the house behind me foreclosed and ultimately sold for a third of the appraised value of my house. The same story is all around me. So many houses that real estate agents lured people into but when things went south, couldn’t afford. When I was buying my house, I qualified for a house three times more expensive than we finally purchased. If I had been suckered, I would be in much worse shape right now. So, that county appraisal does factor in to what a house is worth. Now, what you say is true in that the county waves their magic spell over your house regardless to the additions (tennis court, full fence, new pavement, outdoor fireplace, etc. etc.) and an actual appraisal by a real estate professional will factor all those things in but the comps these days are where you get killed. And I’m not a senior citizen – not yet anyway. I have about 17 years to go at which time, you’re right, I hope my mortgage will be well paid off. What I’d like to do though is like bB, grab onto a nice 3.75% instead of my 5.9% and save myself a couple hundred bucks a month. No crushing need here. Like I mentioned, I am surviving this storm all right. There are many much worse off. My point was mainly to complain that in the county I live in, the assessor does not have to actually lay eyes on your house for 5 years. The 4 years in between, is strictly a formula. I think that’s wrong. I’m sure it saves a tiny bit of money but really? That guy/girl is earning just as much sitting on their rear end than they would be driving around actually looking.

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