Forget Foreclosure. Property Taxes are the New Recession-Era Problem

Submitted by Jen Jones on Tue, 08/10/2010 - 11:26am

Forget Foreclosure. Property Taxes are the New Recession-Era Problem

You can’t turn on a television or read a newspaper today without hearing about the housing crisis, with foreclosure remaining the focus of many a homeowner’s worst nightmare. Yet even in areas where banks aren’t repossessing Americans’ biggest assets, the real estate market meltdown is still having its way with local politics and policymaking, haunting many communities—in the form of skyrocketing property taxes—for years to come.

As PBS Newshour’s Dante Chinni found, many long-term residents in some of America’s more attractive areas are facing unprecedented property taxes as newcomers move in and make themselves at home in houses (and communities) that have ballooned in value—even amid the mortgage meltdown.

As Chinni reports, “Fueled by many out-of-staters looking for a second home with views of the glacier-carved Mission Mountains and only miles from Glacier National Park, property reappraisals including land and home soared to as much as $10,000 per foot of shoreline along the lake. Those increased values helped push Flathead County, which abuts the lake into the Monied 'Burb county classification in Patchwork Nation. And like other communities that experienced rapid growth in real estate assessments those ballooning values came with other costs. On Flathead Lake, the complicating factor has been rising property tax bills. For the new residents who had dropped $1 million for a home, the bill was no shock, but for the residents who had owned their home for 20 years, the new levy threatened to tax them out of their homes.”

Still, the potential for being taxed out of house and home has become routine for many in areas that have witnessed meteoric increases in property assessments over the past several years (such as the Northwestern Montana example above). In some areas, these levies have hit so hard in some towns, “that some neighborhoods have seen special assessments that cut values across the board designed to make home values more realistic and more current.”

In the state of Montana, the average household income is a bit under $44,000. In some counties it’s a bit more, and some a bit less, but in places like Lake County, affected by the reappraisals and rising levies, the average family brings home $38,505. But, as Chinni says, “with property appraisals soaring along some parts of the lake, the average family can only afford so much in terms of land and taxes. But any reappraisals will shrink an already anemic tax base and that could mean trouble for communities trying to keep their services running and financial house in order.”

Until the housing market levels the playing field for many American homeowners, it’ll be a hard many to avoid rising mortgage rates, foreclosure fights, and now, the possible escalation of property taxes—especially during taxing times.

Chapter 13 bankruptcy can provide for the payment of past-due real property taxes and can help you catch up on your house payments, among many other things.

Don’t wait for your own housing bubble to burst. Join the millions of American homeowners who have found immediate help to keep their hard-hit homes. If you have been affected by the mortgage crisis, knowing a qualified bankruptcy attorney can help you to conquer your creditors and face your financial fears, yielding the right kinds of support, information and insights—at a low cost— for a viable and secure future beyond our own “Great Recession.”  The bankruptcy experts at the Law Offices of John T. Orcutt offer a totally FREE debt consultation and now, more than ever, it’s time to take them up on their offer. Just call toll free to +1-919-646-2654, or during the off hours, you can make your own appointment right online at www.billsbills.com. Simply click on the yellow “FREE Consultation Now” button.

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