Posted with permission from Guardian Title—

How Property Taxes Impact Your Closing

by Guardian Title

Especially at this time of year, homeowners question how property tax certifications and payments will impact their closing. We’ve summarized this information to refresh you on the process in Colorado.

Counties assess and certify mill levies and tax amounts annually on real property. This process is typically completed the end of December or early in January. Tax notifications are sent out in January, and property owners have two options for payment. First, they may divide the amount into two installments with the first half of taxes due by February 28th and balance by June 15th. Second, they may pay the full amount on or before April 30th.

How does this affect your closing?
Depending on the time of year in which you close, there are several ways in which taxes will be accounted for at closing. One item found on settlement statements is a proration between buyer and seller. Since we pay taxes in arrears, the seller credits the buyer for the portion of the current year in which they have owned the property.

If the closing takes place early in the year before counties have certified mill levies, the closing agent will typically escrow 125% of the prior year’s tax amount (or use the most recent assessed value if higher). Escrows are held until the certified amount is available, taxes are then paid, and any excess amount is refunded to the seller. If the certified amount is available at closing, that amount will be collected and paid upon closing on the seller settlement.

If a lender is involved in the purchase early in the calendar year, they may request a different means of paying taxes other than in entirety by the seller on the HUD-1. Ultimately, the seller will either pay or credit the full amount due to the buyer on the settlement statement with varying line item descriptions.

What happens when tax payments have been sent to the county but not yet processed?
Tax escrows may be collected and held by the closing agent until the treasurer’s office is able to verify payments have posted for the property. Counties may take a few days to post payments near due dates because of the heavy volume. Once verification is received from the treasurer’s office, any excess escrows are returned to the seller.

On occasion, both the lender and closing agent may submit payments to the treasurer’s office particularly near due dates. If this occurs, then either the lender or closing agent will return the tax escrow to the seller after they receive funds from the treasurer. When closings happen near due dates, it may cause additional delay in refunds due to the high volume of payments being processed.

What is the owner’s responsibility in paying property taxes?
Failure to receive a tax notice does not relieve an owner’s responsibility for paying taxes on time. If you are purchasing a property near year end, please note that your tax statement could be delayed to correct for the new ownership. Closing agents and lenders are not liable for such tax payments, it is solely the responsibility of the property owner.

There is a website that lists the names and contact information, including websites, for the Colorado County Treasurer’s offices. Click this link to be connected…http://www.e-ccta.org/CCTA_home_page.htm

Here in Fort Collins we continue to see a decline in the housing inventory available to home buyers.  Especially in relation to available condos.  In November 2011 compared to last year, the number of available single-family homes was down by 18% and the number of condos was down by 39%.  Yes, I had to double check.  There were 39% less condos available on the market in Fort Collins.

In general, the Fort Collins market has weathered the housing down turn much better than many other areas of the country.  As the number of buyers in our market has decreased, so has our housing stock.  In the last few months, we’ve actually been seeing our median sales price start to creep up a bit which means that the homes in the higher price ranges are slowly starting to sell better as well.

Fort Collins-Loveland posts second-lowest unemployment rate in Colorado

In addition to these numbers, the Northern Colorado Business Report wrote about statistics recently from the Bureau of Labor showing that the unemployment rate in the Fort Collins-Loveland metro area was 6.1% and the second lowest of all areas in Colorado behind only Boulder.  That’s lower than the state average of 7.7% and the national average of 8.5%.

What this means for sellers

This dearth of housing inventory is magnified when you get into the lower price ranges.  If you have a home for sale below $250,000 you will probably see a lot of interest and might even experience some indicators of a seller’s market. For sellers in the higher price ranges, we’re also seeing buyers slowly returning to the market.  This means that your home that you couldn’t give away in 2009 will have some interested buyers although there is still heavy competition in the market.

What this means for buyers

Buyer’s in the sub 200 price ranges are going to be competing with investors for affordable housing stock.  This is a good time to be a landlord and homes that are in a good location are getting snatched up quickly.  Be ready.  This means meeting ahead of time with a lender to see how much you can afford as well as knowing your timeline.  Good deals can still be found, but it helps to do your homework, work with a Realtor you can trust, and know how much you can afford.

The ability to cancel your listing agreement at anytime is rare in the real estate industry

Cancel your listing anytime

My belief is that if your agent is doing their job and working hard, you won’t have any reason to cancel your listing agreement.  If they’re not doing their job, you should have the right to find someone who will.  My listing agreement protects sellers and gives them the right to cancel our agreement at anytime.

Relax, you won’t be locked into a lengthy, binding contract

Did you know that hiring an agent to sell your home involves signing a contract (aka an “Exclusive Right to Sell”) that obligates you to that brokerage (not the agent) for a specific time frame outlined in the contract?  Often this can be 6 months or even a year.  This means that if you are not satisfied with the attention and service you’re receiving from your agent, you cannot simply fire them.  This leaves all kinds of room for your agent to put a sign in your yard and well, slack off.

Only a marketing plan that works can make this offer

My marketing plan works.  That’s why I can offer a cancel-anytime listing agreement.  These days over 90% of home buyers are starting their property search online.  To successfully sell your home, you need an agent that understands this changing landscape. That uses old techniques as well as new.  That understands social media, search engine optimization, listing syndication, and much more.  I know how to market your property.

To learn more or discuss my services in depth, please feel free to contact me at anytime.

Cheyenne is the Wyoming State Capital and source of many government, transportation, and light manufacturing jobs

Did you know that Cheyenne, WY is only a 40 mile, traffic-free commute from Fort Collins and has lots of good job potential? Although we’d all love to live and work in the same town, it’s pretty common for people living in Fort Collins to look for a job in other cities on the front range.  All too often, they forget to look at Cheyenne as a viable source simply because it’s in another state.  From Fort Collins it’s actually only 40 miles of virtually empty interstate to Cheyenne versus an often congested 60 miles to Denver.  It’s even shorter if you live on the northeast side of Fort Collins.

About Cheyenne

Cheyenne is the state capital and also home to a large sector of government jobs.  Warren Air Force Base is the largest employer with about 4,200 civilian and military employees.  The federal government employs over 3,000 civilians and the state government employees about the same number.  In addition, Cheyenne’s economy is based on transportation, light manufacturing, and agriculture.  The largest private sector employer is Union Pacific Railroad and employees 800.

Commuting from Fort Collins to Cheyenne is an easy 40 mile drive on I-25

Cheyenne companies

Some of the larger companies in Cheyenne include: United Medical Center, Union Pacific Railroad, Lowe’s Companies, Inc., Sierra Trading Post, Echo Star Communications, Frontier Refining, Wal-Mart, Little America, Hitching Post Inn, and Life Care Cheyenne.

Generalized building development by decade in Fort Collins

When you first take a glance at a map, it shouldn’t take you long to realized that our city is laid out in a logical, grid like fashion.  In Fort Collins there are arterial streets and there are collector streets.  It turns out that our arterial streets are each laid out exactly one mile apart from each other.  From north to south these streets are Mulberry, Prospect, Drake, Horsetooth, and Harmony.  From east to west they are Timberline, Lemay, College, Shields, Taft, and Overland.

Eastborough home built in 1985

Focusing on the neighborhoods near College Ave, you can develop some basic expectations of what to expect in home design, lot size, and features as you tour different neighborhoods.  Here’s a basic summary of the areas of development by decade.

• 1950′s and before – North of prospect you will find Old Town Fort Collins and the bulk of our housing dating from the 1950′s and earlier.  Homes in these neighborhoods were characterized by bungalow style floor plans, front porches, and many long narrow lots with alley access.
• 1960′s – Between Prospect and Drake you will find lots of ranch-style homes typically featuring low roof lines, 1 car garages, a smaller footprint, and small working kitchens.  The most notable example of this is South College Heights on the northeast corner of College and Drake.
• 1970′s – Between Drake and Horsetooth you will find a concentration of 70′s home styles.  Kitchens started to get larger, new paneling materials started to be used, baseboard heating was common and many bi-levels and tri-levels were constructed in this time period.
• 1980′s – Between Horsetooth and Harmony we get a taste of the 80′s.  Two good examples of this are homes in Warren Lake area and Larkborough on the northwest side of Harmony and College.  This style may be coming back in apparel but I don’t anticipate it coming back in home styles.  Think Nagel prints, salmon colored walls, and hunter green.
• 1990′s and beyond – At this time development continued to push south of Harmony but also started to fill in on the east and west sides of Fort Collins.  Generally newer homes in Fort Collins trade larger living areas for smaller yards.