The U.S. home price index reported its largest home value price drop in 2008 and home prices continue to decline.  “Under-water” mortgages and bank foreclosures continue to turn the American Dream into a nightmare for many homeowners, yet property tax bills often do not reflect the loss in home value.

This makes it particularly important for homeowners to monitor their tax bills for accuracy under current property value and know their rights.

If you have a mortgage, your tax bill can generally be estimated by your lender and added to your mortgage payment.  Most homeowners pay their mortgage lender for three things:

1. principle balance
2. interest
3. property tax held in escrow

If you own outright, you’re faced with a large tax bill twice a year.  Here’s how ensure you are being fairly taxed:

1. Check your assessment for accuracy. In most counties your assessment is available online at the county assessor’s website. Ensure your assessment has the correct information regarding your property and the factors that affect its tax assessment such as lot size, square footage, number of bathrooms, etc.
2. Take a look at the assessments on other similar properties in your neighborhood and compare them to yours. If there is an unexplainable difference, your property may have been over valued and can be appealed.
3. Ensure that you are receiving all eligible exemptions (e.g. homestead exemption, senior citizen freeze, etc.). Information on exemptions may be found at your assessor’s office.

Timing is critical as homeonwners in the current market face a dual threat:  Bank foreclosure if they are unable to pay therir mortgage and government foreclosure if property taxes go unpaid.

A bank foreclosure involves a civil lawsuit and involves a judgment being entered and, if nothing else, buys time for the homeowner. 

A Government foreclosure for unpaid taxes goes direct to tax sale once a final payment deadline is missed. Inquire with your assessor regarding the timeframe in which appeals must be filed. 

About our Guest Blogger:  Ahmed Motiwala is an attorney licensed in Illinois. He received his Juris Doctrate from The John Marshall Law School where he was a research assistant in the area of Property Law. During law school Motiwala  received extensive experience in prosecuting complex criminal matters at the Cook County States Attorneys Office and has also defended the CTA in a variety of personal injury cases.