Newsflash: [MA] Got an escrow shortage notification, found my taxes went way up, does this impact my home value?

Hey guys, I was going to post this in /r/PersonalFinance, but I feel like I understand the financial part of the scenario but was looking for insight on how everything works together for the value of my home and figure you guys might be the place to go. There’s a tl&dr at the end, and I apologize for any formatting problems in advance.I purchased my home in June of 2016 for roughly 3.5% down, financed $284,650, and my payments came to $1,741.11 including $142.33 in PMI and $1,298.15 as principal/interest. At that time my tax assessment was $249,000 and my appraisal was $295,000.This month I was notified of an escrow shortage of $1,672.11 as well as a monthly increase in my payment to escrow of $70.55. Out of lucky coincidence, I’m due a decent retro check for working out of contract for the past 12 months which will cover the option of making the lump payment of $1,672.11 instead of having that also rolled into my payments. This left me with two questions however; if I go with this lump option and the smaller payment increase and nothing further changes in the next year, will I have to make a similarly sized lump payment again next year; or will this smaller increase supposedly adjust for the higher amount needed into the future?My second question I answered myself is what increased so much. To this I looked up my HOI – no changes. My tax assessment on the other hand went up to $307,600 (57,600 or a 23.5% increase). My town has no tax assessor or assessors office to call directly, and instead contracts out to a third party which makes their assessments, but not reasoning, available online. I was not notified by them of an assessment increase, and I am not aware if there is an appear process or deadline. Some of my neighbors have seen a similar increase, but not all. There have not been any major infrastructure undertakings or obvious features or capital improvement projects that would lead to any major increases.I’ve got no qualms about my property value increasing – that’s why I’m buying and not renting after all, but while understanding that there is no such direct correlation to assessment/appraisal, what should my realistic expectations for my property value be? I’d planned on refinancing eventually when it made sense to get rid of my PMI, and possibly take cash out to pay off whatever remains of credit card debt from getting married and furnishing the home. Would it be entirely unreasonable to expect a similar (23.5%) increase in my appraisal? I was told the rule of thumb was that assessments were around 80% of the value but that there was no hard and fast guarantee. I’ve done minor improvements to the property such as building a shed and fencing in the yard, but no major overhauls or new features. The condition of the house has certainly not decreased at all in a year.Thanks for any insights!TL&DR: Taxes went from $249,000 to $307,600 this year and not entirely sure why. Can I assume my market value or appraisal would increase by a similar amount?

Read more at https://www.reddit.com/r/RealEstate/comments/6m9vy9/ma_got_an_escrow_shortage_notification_found_my/?utm_source=ifttt

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s