Prorated real estate tax?

Question

I bought a home cash. There is a title co. in place. They sent me copy of deed which they sent for recording on July 31, 2008. Along with the deed was a letter stating there is an installment due on August 31, 2008 for $1100.00 and that since I am now the owner I should pay it because it's due when I now have ownership. Agent says, "Right now, Summer 2008 taxes are due August 31, 2008. The purchase contract signed by the seller, (x*x) and buyer, (xyz), indicates that the tax proration is to be paid by buyer. So, when taxes are due, they're to be paid by the buyer."

Does anyone interpret that If Buyer signed they will be responsible to pay "Prorated Tax" means that the Buyer has to pay that whole installment because I'm now the owner and it's due August 31, 2008 and now too bad I'm stuck with it?

The title co. says they are not escrow because there is no bank or lender involved and that I have to take it upon with the Seller.

My question is did title co. interpret correctly, or I'm I wrong and I'm screwed because I signed that I will pay "prorate tax"?

Getting in contact with the seller is almost impossible. But it all boils down to the interpretation of me paying "prorate tax".

Answer 1

Prorated taxes should have been handled as a "credit" (not necessarily escrow) during closing against what you owed for total down payment and closing costs.  But if they already paid the first installment and this is second installment, the credit would have only been 1/6th of 2nd installment ($183.33).

So look over your closing papers and see if you got any credit towards property taxes, or how much effort you want to expend to get less than $200.

Note that in some states property taxes are collected the following year, so previous owner of my home purchased 2002 was responsible for all 2001 tax due in 2002, and estimated partial 2002 tax due in 2003.

Answer 2

from your data, it looks like you are respnsible for the tax from July 31 to August 31.  The seller would be responsible for the taxes from Jan 1 until the sale date that looks like july 31.  Check with the closing attorney.

Answer 3

your portion due is from the date of sale on... the rest is the sellers responsibility.  get a hold of the seller via the title company.  that is why you pay the title company... to sort this out.

raise h**l and make sure they get it done soon!

Answer 4

You are the owner of the property and thus have to pay the taxes or they will go into default.  Ordinarily there will be escrow instructions to the title company providing that taxes would be prorated and they would show as a credit on your closing statement. Check yours! Whatever arrangement you had with the seller or title company is a side issue.