How Long Before Bank Pays My Delinquent Property Taxes

[Coleu]

My question involves a mortgage in the state of: California

Here in California by law a lender cannot impose an escrow account for property taxes unless they loan you more than 90% of the value of the property. Consequently, I do not have an escrow account with the lender.

My mortgage is paid but the first installment of my property taxes is 60+ days delinquent. The second installment is due in April. If both are not paid by July 1, the property is listed as in default of the property taxes. By January 1, tax lien is filed. The county will not foreclose on a tax lien for 5 years but of course penalties and interest accrue during this time.

It is my understanding that the bank will pay these taxes at some point in order to protect their interest in the property. My question is - how long will the bank wait?

My county does not notify the lender of the delinquency, but it is my understanding that the banks hire companies to routinely examine the property tax records to find out about delinquencies and act on them. I am over 60 days late on the first installment and have been assessed a delinquency penalty on that installment already so I am a bit surprised that they haven't paid them yet. Maybe it is because the second installment hasn't come due yet? Do they wait until the full amount of the taxes are due?

I am looking for anyone who has had experience with this to let me know how it works in actuality - how long will they wait to pay the taxes?

I understand that once they pay them an escrow account will be required as well as additional payments for the unpaid taxes and penalties and interest so that is not part of my question. I just want to know about how long they will let this go on before they pay the taxes. Thanks!

[Mr. Knowitall]

If you want to know the bank's policies, you need to ask the bank.

[jk]

It is my understanding that the bank will pay these taxes at some point in order to protect their interest in the property. My question is - how long will the bank wait?

the bank, unless there is an escrow in place, often will not pay the property taxes until the state intends on taking the property for overdue taxes.


beyond that, a mortgage lender often has a first right of purchase in a tax sale. That would mean they would not simply pay the taxes but would be purchasing the property through a tax sale.





You generally don't get to set on your butt and refuse to pay taxes without at least a penalty but far more often, risk losing the property.

[Coleu]

If you want to know the bank's policies, you need to ask the bank.

I did and they told me that they would pay them immediately upon them becoming delinquent. They did not do that.

the bank, unless there is an escrow in place, often will not pay the property taxes until the state intends on taking the property for overdue taxes.

While I don't know how long it will take, I know what you posted above is no where near true. The banks pay them long before there is a danger of a tax auction. They would be stupid not to since the tax lien is a superior lien to a first mortgage.

I was asking those with experience in this type of situation, which you clearly do not have, to give me an estimate based on their experience. I can tell you the banks don't let the property get anywhere near being auctioned off before they pay the taxes, which in my county takes 5 years anyhow. I am just not sure whether the bank will wait until the formal declaration of default on the taxes or if they will pay once the second installment is delinquent.

[cbg]

How many people with delinquent property taxes, in your state, using your bank, post here regularly? Or do you imagine that all banks in all states manage this issue identically in all situations?

[Coleu]

How many people with delinquent property taxes, in your state, using your bank, post here regularly? Or do you imagine that all banks in all states manage this issue identically in all situations?

My bank is the largest bank in the world and I live one of the most populated counties in the most populated state in the US. This particular state does not allow escrow accounts except if you are borrowing 90% or more of the value of the home, so it is the norm not to have them. Over 60k people were delinquent on their property taxes in my county last year.

Based on that, I would say the odds are pretty high.

According to the county tax collector, the banks employ services to check their records, which makes sense. It's routine so I think this is managed according to pre-defined protocols and not on a case-by-case basis. The bank won't tell me what their procedures are other than to say they pay the taxes immediately upon them becoming delinquent, which is not what happened.

I see you have no experience in this area, either. And it is not just people who have been in this situation who could answer this for me, it is attorneys who handle mortgage foreclosures in California who would know this sort of information. Presumably the membership here includes attorneys in California.

[jk]

I was asking those with experience in this type of situation, which you clearly do not have, t

ok, if you say so.

[Coleu]

ok, if you say so.

no need to troll.

[jk]

My bank is the largest bank in the world

the Royal Bank of Scotland writes mortgages in California? Wow, I didn't realize that.

[cbg]

I don't claim to have experience in this area, which is why I didn't attempt to answer your question. However, I don't have to be either a lawyer or delinquent in my taxes to know that your assumptions that first, you are entitled to pick and choose who answers your post; second, that there are dozens of volunteer experts from all states and in all areas of law hanging out on a message board waiting for you to post; and finally, that there is one across the board answer that will apply in all situations, are all wrong.