What is a Tax Abatement?
A tax abatement is a temporary reduction or elimination of property taxes, often granted by local governments to encourage development or investment in certain areas. These abatements can significantly reduce the financial burden on property owners, making them an attractive option for many investors and homeowners.
Our Specific Tax Calculation for Properties with Tax Abatements
To better serve our clients, we have implemented a unique tax calculation method for properties with tax abatements. This method ensures that the property taxes used in mortgage qualification are accurately reflected, providing a more realistic financial picture for both the lender and the borrower.
Qualification Criteria
For a property to qualify for our reduced tax calculation, it must have a minimum of a 5-year tax abatement. This ensures that the tax benefits are substantial enough to impact the mortgage qualification process meaningfully.
Example Calculation
Let’s break down how our tax calculation works with an example
- Property with a 10-Year Tax Abatement:
- To qualify, the property taxes will be calculated based on the amount due at the end of the 5th year after the first mortgage due date.
This approach provides a more accurate representation of the long-term tax obligations, helping borrowers make informed decisions about their investments.
- Expert Guidance: Our team of experienced mortgage professionals is here to guide you through every step of the process, ensuring you understand all aspects of your mortgage, including tax implications.
- Customized Solutions: We offer a range of mortgage products and services designed to meet the diverse needs of our clients, from first-time homebuyers to seasoned investors.
If you’re considering purchasing a property with a tax abatement or have questions about how tax abatements can impact your mortgage, contact MortgageDepot today.