Taxes, Assessments, & Property Values. Some Timely Information for Property Owners.

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Mortgage and Lending with NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656 IL Lic 031.0006220/WI

Taxes, Assessments, & Property Values

Some Timely Information for Property Owners
 
 
     It's "THAT" time of the year again.  All across the collar counties of Chicago, property/home owners are receiving (or soon will be) their 2010 Property Tax Bills.  Within these counties, 1st instGene Mundt Chicago Bancorp Taxes, Assessments & Property Values Info Blogallments of these tax bills are due in June and the 2nd installment in September, as a rule.
    
     While the majority of the property/home owners with a mortgage have their property taxes paid directly out of Escrow Accounts held by their loan servicer, the "sting" of paying property taxes still exists. 
 
     I can tell you by the activity I have seen through my Twitter and  Facebook accounts, the arrival of the property tax bills has set-off a firestorm of conversation and controversy.  I can also tell you from being a mortgage lender  in Chicagoland, my phones start ringing every year with their arrival too.  The arrival of property tax bills typically gets homeowners thinking about the possibility of refinancing (a link to my Chicago Bancorp refinancing information) their homes.  It's my job to see if it's wise .. or a possiblity to do so.
 
     For many homeowners, the "equation" and method their county governmental taxing bodies utilize for arriving at the amounts due on propertytax bills is somewhat shrouded in mystery.  So I'm going to attempt to answer here within this post, some of the questions I most often hear surrounding property tax bills themselves.
 
     This year in particular seems to offer a multitude of interesting scenarios regarding property values, to say the least.  At least in a majority of our Chicago and Chicagoland area, property values have dropped fairly significantly during the last 3 years.  Some areas have most assuredly been hit harder than others, with declines seen in some statistical areas being as much as 40 - 50% since the housing value "peak", considered by most to be the year 2007.  
 
     As a result of their property values declining, most homeowners are expecting to see a corresponding drop in their home's/property assessed values, and a drop in their actual property tax bills when they receive them.  However, they are many times disappointed as this drop does not typically happen immediately.
 Gene Mundt Chicago Bancorp Tax, Assessments, & Property Values Info Blog
    
    Why?
 
     There are thousands of differing types of property found within each township, varying in property types and property usage.  These properties can represent vast extremes.  Anything from nuclear powerplants, vacant land parcels, warehouses, to residential and more can all "reside" within a governmental taxing body's borders. Family residences are our primary focus here within this post.
 
    
     But whatever property considered, properties are NOT inspected for re-assessment each and every year.  Nor are the "comparables" for each property.   This is done typically on a rotating 3 year average.
 
     According to the  Supervisor of Assessments Office in Will County, IL( www.willcountysoa.com  for answers to frequently asked questions) the actual assessed value of a property is arrived at by the 3 (three) most recent years of sales activity for that property ... and surrounding properties.
 
     This three (3) year average accounts for a more stable assessed property level.  It will not however, allow for quickly changing market swings ... such as those that are being experienced currently across Chicagoland and much of the nation. Assessors (public officials that establish the value of a property for taxation purposes), for lack of better terminology are ... playing "catch-up" on property assessments.  And that can work in a property owner's favor in an upswinging market ... or against them, as in the market we are presently experiencing. 
 
     There is also an "equalization factor" that is differing and separate for each village/county/state that is distinctive to the township you reside in.  This equalization factor further confuses many homeowners/property owners.  As the factor may not remain the same for each year's tax bill.  It "floats" and changes. 
 
      According to the Will County Supervisor of Assessment's definition, an  "equalization factor"  is: Equalization is the application of a uniform percentage increase or decrease to assessed values of various areas or classes of property in order to bring assessment levels, on average, to the same percentage of market value.  Equalization of assessed values is important (and performed)  at each level of government - township, county and state.  Chief County Assessment Officers (CCAO), County Boards of Review and the State possess certain powers to equalize assessments.
    
    Perhaps the best information that I can pass on to readers here surrounds the steps to be taken should you wish to appeal/protest your taxes... which is actually a protest of your property's assessed value.Gene Mundt Chicago Bancorp Taxes, Assessments, & Property Values Info blog
     
    Should you feel that your property is being unfairly assessed, you must provide a basis for your protest with hard factual data.  Much of this data can be compiled by the property owner themselves.  Other property owners feel the need to hire a  licensed real estate appraiser to do a report.
 
     In most cases, an  appeal/protest  and compiled factual data must be presented within 30 days of receiving your PROPERTY ASSESSMENT NOTICE ... not the property tax bill itself.  (Please check with your property's tax assessor's office for the timing of your property assessment mailings.) 
 
    Again ... waiting for your actual property tax bill to arrive is TOO LATE.  You are protesting/appealing the ASSESSMENT of your property, not the tax bill itself.  Stay in tune.  Be aware of the release of new/re-assessments of properties that will reflect and assist you with your own appeal/protest.  There are strict guidelines and timeframes in which you must work should you hope to be successful in appeal/protest of your taxes.  Each county has its own specific rules, regulations, guidelines, and timeframes.  You may not be able to rely on a friends, relatives, or co-workers set of guidelines for your specific property.  
 
     I have included some additional links below to help in the understanding of your property's assessment, as well as links to more detailed and complex property assessment information and considerations.  I hope that they prove of assistance to you.     
 
    
Here are some helpful links to aid you
in your search for information:
 
      
    Looking for a particular property's date of sale in Will County, IL?   Go to:
 
     Seeking the Contact Information for the Tax Assessor in your Will County Township?
 
    Seeking information regarding the protest/appeals process for your Will County, IL property assessment? 
 
    The Will County, IL Treasurer's Office link and info:
 
    DuPage County, IL  ... Information on Appealing Assessments:
 
    DuPage County, IL ... County Assessor's Directory:
 
    DuPage County, IL ...
    Supervisor of Assessments, Equalization Factor Calculation Background & Info:
 
    Kane County, IL Assessment Office link:
 
    Kane County, IL ... Rules and Procedures for Filing an Assessment Complaint:
 
    Kane County, IL ... Assessor List and Links to Websites:
    
    
Some helpful tax forms for area Senior property owners:
 
   
     In Will County, IL:  The 2011 Senior Citizens Assessment Freeze and Homestead Exemption Application and Affidavit:   
 
    In Will County, IL: Dates for Forums held around the County of Will to Assist Seniors regarding the Seniors Assessment Freeze and filing of forms:
 
     In DuPage County, IL:  2011 Application and Affidavit for The Senior Citizens Assessment Freeze Homestead Exemption:
 
    In Kane County, IL:   2011 Application for the Senior Citizen Assessment Freeze Homestead Exemption:
 
 
 
 *   To discover what the tax escrow payment on a Chicagoland new home purchase would be, please  contact me  today!  I can be reached at: Direct:  815.277.4036, Cell/Text:  708.921.6331, Email: gene@chicagobancorp.com., or through my website at: http://www.genemundt.com/Contact-Info.html
    
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Gene Mundt

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Rainmaker
111,614
Mike Schneider
10 YRS with Active Rain ! - Lake in the Hills, IL
ABR, CDPE, SFR

Gene: terrific info and i will keep this post as a reference. thanks for the inside story.   Mike

May 09, 2011 09:59 AM #2
Rainmaker
427,439
Leslie Ebersole
Swanepoel T3 Group - Saint Charles, IL
I help brokers build businesses they love.

Wow, looks like I'm first. Congrats on feature.

Kane County is going through it's tri-ennial reassessment. We have been told by Mark Armstrong to hold off on appeals until the re-assessment is done.

The time to do an appeal is when the assessments are published in the paper in the late summer-early fall. Each assessor's office has a different schedule, but each township will have a 30 day cycle. This is usually Aug-Oct in Kane.

We've gotten a lot of calls, too. All those agents who told homeowners their taxes would go down on the distressed property they bought - didn't happen!

My multiplier for a 30 year old house on the east side of St. Charles went up to over 7.2. When I bought this five years ago it was 6.2. My taxes went up another $550. This has gotten completely out of hand!

 

 

 

May 09, 2011 10:01 AM #3
Rainmaker
1,246,270
Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi
NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656 - New Lenox, IL
708.921.6331 - 40+ yrs experience

Dale:  Thanks for the compliment.  It's appreciated.  Hope it provides some assistance to you and your clients ..

Mike:  One of the best bonuses of posting localism posts is finding new local AR members.  Welcome and thanks for commenting!  Always a pleasure ... and I'm looking forward to learning more about you in the future.  Hope you find this post beneficial in the future ...

Leslie:  Unfortunately, I've heard so much of what you relate over and over.  I know the post above got rather long, but I wanted to place as many links to info in it as possible for the three counties I do the most business in.  As you point out, each has its own intricacies of how it handles taxes and assessments, postings, and making info available ... so property owners need to be on their toes.   

Erroneous info given at the time of purchase ... oh wow how I hate to hear that.  Professionals should stress that property owners need to appeal/protest the assessments they receive, not the actual tax bill.  Owners get that confused all the time.  And when questions of taxes are involved, ALL professionals should do their homework and proceed with caution when providing info.  Tell a new homebuyer they can count on taxes going down within a certain timeframe??  You better darn well know that for a fact and have it in writing from your governing body too!  How often does that happen??  And until it does, you proceed with escrow payments calculated on the last actual tax bill.  You don't tell a property owner otherwise ... 

And yes, taxes going up are a real issue right now.  I understand government services must be delivered, still.  I applaud your governing body getting the word out on the tri-ennial assessment taking place.  Forward, progressive, and anticipatory actions make the whole process so much easier down the road.

Gene

May 09, 2011 10:28 AM #4
Rainmaker
421,084
Michelle Francis
Tim Francis Realty LLC - Atlanta, GA
Realtor, Buckhead Atlanta Homes for Sale & Lease

Gene, 

Amazing info!  I love this detail for the consumer.  We are just getting our tax assessment notices in GA.  You guessed it, even though values are down on assessments, taxes went UP dramatically as millage rates increased!  I'm off to write a similar type blog post for Atlantan's to see what they can do for tax appraisals that are out of bounds. 

All the best, Michelle

May 09, 2011 10:30 AM #5
Rainmaker
1,101,506
Margaret Goss
Baird & Warner Real Estate - Winnetka, IL
Chicago's North Shore & Winnetka Real Estate

You have done a marvelous job explaining taxes in this area - it is a daunting subject.  Adding to all the confusion is the fact that we (at least in Cook County) pay our property taxes in arrears. 

May 09, 2011 10:50 AM #6
Ambassador
2,910,457
Tammy Lankford,
Lane Realty Eatonton, GA Lake Sinclair, Milledgeville, 706-485-9668 - Eatonton, GA
Broker GA Lake Sinclair/Eatonton/Milledgeville

Well Gene, you certainly gave me a good idea for a local post.  But really 2010 taxes just now due?  Wow.  In Georgia 2010 taxes were paid in 2010.  Generally speaking around our state the bills comes out in October and are due mid to late December. 

Our new "assessments" come out January to March with all appleals due in April.  Generally I too get a LOT of phone calls, this year, not so many. 

May 09, 2011 12:10 PM #7
Rainmaker
631,269
Nancy Conner
Olympia, WA
Olympia/Thurston County WA

What a wonderful post of helpful info and good links to more resources!  Taxes aren't anyone's favorite topic, but this is excellent information for your area!!

May 09, 2011 12:30 PM #8
Rainer
59,881
Eric Rogers
Century 21 Pro-Team - Aurora, IL

Great Info Gene - thanks for posting. I had a client call me just 2 days ago wanting to protest a tax bill.

May 09, 2011 12:30 PM #9
Rainmaker
1,171,937
Jane Peters
Home Jane Realty - Los Angeles, CA
Los Angeles real estate concierge services

I am sure they are quicker to raise those taxes, especially after a change of ownership, than they are to lower them.....

May 09, 2011 12:56 PM #10
Rainer
284,418
Steven Cook
No Longer Processing Mortgages. - Tacoma, WA

Gene -- Great information -- too bad you didn't write it up in March.  Now, I will have to remember this until next year! Our reassessments come out in January -- and first half taxes in April.

May 09, 2011 01:37 PM #11
Rainmaker
1,246,270
Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi
NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656 - New Lenox, IL
708.921.6331 - 40+ yrs experience

Michelle:  Sounds like the tax issues being felt all over our nation!  Will have to check-out your post re: taxes for Georgia's residents.  Hope my blog was the inspiration??

Margaret:  Chicago .. and much of the surrounding area seems to handle taxes in a little different manner than other regions/states.  It's all about educating yourself to the realities of the governing bodies and their calendars regarding these property issues.  Hopefully, this post helps clarify some of that info for Chicagoland residents.  Thanks for the thumbs-up!  You're always so supportive ...

Tammy:  Welcome to Chicagoland's way of doing business!  And I think the number of calls will be down across the board regarding these issues.  Many resident property owners just assume that they will be capable of doing little regarding refinancing or selling, given the media's reporting of property values.  I still urge owners to call.  It never hurts to get a true picture of current financial and credit options.  Will be looking forward to your post ...

Nancy:  Thank you.  I don't think anyone loves taxes!  But knowing and understanding how the taxing bodies and tax systems work is preferable to remaining in the dark about it all.  I'm hoping the post helps people understand a bit better ..

Eric:  Nice to meet you!  I said it above, but will repeat ... I like doing the localism posts as I typically find more Chicagoland real estate professionals here on the Rain.  Glad you commented.  Hope your client you mention has good luck moving forward ...

Jane:  Welllllllllllllllllll ...

Steven:  Please feel free to bookmark the post, if it will help you in the future.  I'm sure this won't be the last you see of tax related posts here on the Rain either.  Thanks for commenting ...

Gene

May 09, 2011 01:58 PM #12
Rainmaker
518,338
John Elwell
CENTURY 21 Bill Nye Realty, Inc. - Zephyrhills, FL
You Deserve a Full-Time Agent, Not Reduced Results

In Florida we only pay once a year and that is in arrears. We will not get our bill for 2011 until November 2011 and they will not become overdue until April of 2012. It is interesting how each state collects their taxes in different ways.

May 09, 2011 02:39 PM #13
Rainer
164,180
Howard and Susan Meyers
The Hudson Company Winnetka and North Shore - Winnetka, IL

Excellent and comprehensive post..as usual Gene

The bottom line for people who believe that their property taxes will go down as property values decrease is for them to ask themselves if they believe that local and county spending will go down? If the answer is "no", then where is the money going to come from?

The best one can hope for is that they pay their "fair share" and no more. 

In the past, Cook County would place a market value on any property and it would seem to have no rhyme or reason. You could protest that evaluation, but the results are often mixed.  If there was a transaction, the new property tax would be higher because the transaction would verify a higher market price.

Now, when there is a transaction...generally at a lower price than the previous property estimate, Cook County automatically assigns a new  "total assessed value" based on the new transaction price. 

Unfortunately for the buyers of foreclosures, Cook County doesn't use the distressed foreclosure price as the new barometer of market value.

 

May 09, 2011 04:12 PM #14
Ambassador
414,247
Emily Medvec Qualifying Broker
Hello Realty - Santa Fe, NM
Realtor | Serving Santa Fe & Northern NM

Outstanding post! Congratulations on the feature! I think this is one of the best on this "hot" subject in every community. Chicagoland is fortunate to have you there. By the way, I hope AR catches the spam in posts numbers 15, 16, 17 and 18. 

May 09, 2011 04:26 PM #15
Rainmaker
1,246,270
Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi
NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656 - New Lenox, IL
708.921.6331 - 40+ yrs experience

John:  You're so right .. each state .. and even counties and townships can have their own little rules and timeframes to work within.  You point out a very important topic .. that of being aware of your own little part of the world's tax and assessment idiosyncrasies.  Moving into just the next township over can make a big difference.  Thanks for commenting!

Howard and Susan:  Thank you for the kind words.  And you make a very valid point.  The COST of conducting a city/county/state's services stays the same to a large degree, no matter the values of the properties within it.  Most residents don't want to see their government's services diminished.  But should a government have less tax money to work with because of changing assessment/taxes collected, that will be what happens.  It IS a choice to be made.  Costs can be cut only so far before it reflects on the quality of life within the boundaries of the taxing body.  It then starts to diminish the value of the properties found there.  A very frustrating set of circumstances, to be sure.  Always good to hear your opinions and comments ...

Emily:  The subject of taxes IS hot right now, no doubt.  I'm getting questioned alot as of late .. even thru my Facebook and Twitter connections!  I'm hoping the post above has helped provide a little understanding of the local tax system ... and also provides some helpful links to use should they have further questions.  And I'm hoping AR sees the spam too.  Four??  That's alot ...

Gene

May 10, 2011 02:30 AM #16
Rainmaker
1,246,270
Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi
NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656 - New Lenox, IL
708.921.6331 - 40+ yrs experience

Erica:  10 years???  wow ... that's truly amazing and almost alarming given what has happened to real estate values in the last ten years.  With all the readjustments though .. I wonder just how close the values are now in comparison to what they were 10 years ago?  Close?  Same?  Would be interesting to view the comparisons ...

Gene 

May 10, 2011 04:32 AM #18
Rainmaker
427,439
Leslie Ebersole
Swanepoel T3 Group - Saint Charles, IL
I help brokers build businesses they love.

Hi Gene: you know I'm not a rabble rouser, but the tax issue is huge and will probably occupy my attention for quite some time. So many people never read the detail on their tax bills, and they should. At least in Kane County, you can see exactly how much is going to everything from your town's library district to the fire protection district's pension fund. Everyone does need to pay their fair share, but with so many people in financial distress, it seems a little harsh to have so much of my taxes going to the pension funds of other people.

Which brings us back to the whole issue of bank difficulties. All those people who say "let the big banks fail"? Well, the bank itself might fail, but it's the pension funds and mortgages and small business loans that will be hurt. Money isn't real -- since we went off the gold standard in 1973(1971?) money has simply represented the credit of the US government.

I'm going to hush now. Too much for a comment.

I'm going back to asking for 105% for buyers. I had throught that 103% was reasonable, but I gues it might not be.

Again, great post.

May 10, 2011 03:42 PM #19
Rainmaker
1,246,270
Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi
NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656 - New Lenox, IL
708.921.6331 - 40+ yrs experience

Leslie:  I don't know!  Maybe a little bit of rabbling??  hehe ...  But that's all good in my book.  And you are so right when you point out that there are so many "fingers" in the tax pie.  So many things to consider as contributions to the problem.  But to be fair to agents and builders ... if there is a mortgage involved in the purchase, we lenders are the bottom line when it comes to figures regarding taxes.  WE lenders need to offer sound advice and sound numbers to the buyers.  WE have to prepare them for what most likely lies ahead for them.  We are remiss, should they buy and think something other than fact.  And today's facts are based on the most recent tax bill, in most pre-owned homes.  In new construction, we lenders have to do our homework and pass on the FACTS as we know the future to be. 

It's interesting that you bring all this us right now.  My own son is in the process of buying.  He's presently looking at a model home of a local builder.  Taxes are all over the place within the subdivision ... and on the same street!  Totally amazing to me.  He's in communication with the local assessor to see what is on tap as far as re-assessment of the property.  Taxes on the home will play a huge part in his decision to move ahead with purchase .. or not.  Taxes are going to do that in more and more purchases.  We need to get a handle of this issue quickly ...

Let's talk soon ...

Gene

May 11, 2011 03:17 AM #20
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Rainmaker
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Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi

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