Real Estate Taxes and Insurance in Foreclosure.

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Services for Real Estate Pros with STAMATAKIS + THALJI + BONANNO

It is very important that you maintain a full and thorough understanding of your property, its condition, and status throughout the process. Each November your local property appraiser begins collecting taxes for the previous calendar year. This is known as paying your tax certificate. If you do not purchase your tax certificate by the following May then your tax certificate may be purchased by any person at auction. The holder of the tax certificate may foreclose on the homeowner after 2 years and effectively take over control and ownership of the property for the cost of the tax certificate itself. If you choose not to purchase your tax certificate then the bank will likely do so to ensure their investment. The last thing that the bank would want during this process is to lose the property (and the value of the loan owed) to an investor who essentially purchased the home from under them for pennies on the dollar. Because the holder of the tax certificate stands first in line at foreclosure, the bank tries to keep their hands on any unpaid tax certificates.

 

Insurance, if possible, should always be maintained on your property. Again, if you do not pay for your insurance or it is not part of your escrow payment then the bank will likely continue to purchase the insurance to protect their investment in the case of storm, fire, or severe property damage. Even though you are not paying, the bank will not want to see their money go up in flames. However, the bank may scale down the coverage to only protect their investment in the value of the land and the structure itself and not anything more. Therefore, if your home is filled with valuables then it is probably a good idea to maintain insurance to the extent that it can be afforded.

 

The homeowner should be careful to maintain personal liability insurance on the property in the event that somebody gets hurt on the property and decides to sue. If you do not maintain your personal liability insurance then you may be sued personally for any injuries or negligent acts occurring on your property.

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