When your home sells, typically it’s being sold for more than when it last sold, especially if the previous owners lived there for some time. What happens next, the process and amount is different for every state and city, you will get a notice stating your home’s value has been reassessed based on the recent sale price and your tax bill will reflect now this new value, which is usually included in your monthly payment. That means your payment will now go up based on that rise in tax revenue.

Lenders and agents often forget to mention this so it’s important you research current tax rates and how they’re allocated when they rise and how high they can go up. You can call your local city and your agent should be able to pull up records for you from MLS and public records, as can you, and go over the numbers to calculate and estimate the rates you will pay. Your approved payment on your home will be different within a couple of months after closing so be prepared and consider that when purchasing. Your lender and you can discuss this so you can make decisions to buy or not before it’s too late in the transaction.

This is purely information and differs from one home and area to the next. Have the conversation with your lender and agent and talk to your county assessor so you understand how your payment will be affected sooner rather than later. If the sale price isn’t far off from its last, then likely the change won’t be as dramatic. If the home hasn’t previously sold for a long time, then understand you could see a jump of a few hundred dollars in your monthly mortgage payments. Know your numbers and do your due diligence right away!

Be aware of any impending tax hikes too. I have seen this happen with people who weren’t aware of upcoming town council meetings that were planned to discuss a 12% hike and many were blindsided just months after buying so before buying, research the town board and how they’re planning things for the future. Usually meeting notes and news is on their website as well as upcoming events seeking public comment. Know before you buy!