How to tell if your taxes are included in your mortgage
By james on October 24, 2014
It's that time of year again! Late October in Oregon. Time for all the non-Multnomah county residents to pat themselves on the back and temporarily feel superior, and bask in the glow of their money savings for a couple weeks. Property taxes are now certified for the state of Oregon. This means that the county in which you live will be sending you an actual bill for property taxes in the mail. Now when this happens, a not insignificant percentage of my clients who have just purchased in the last 12 months get a quick and I imagine THRILLING spike in their blood pressure upon receipt. They ask themselves- "doesn't my mortgage payment include the taxes every month?..... I CAN'T REMEMBER EXACTLY!". And they email me or call me for confirmation. Since this is such a common occurrence, I thought I'd take it upon myself to publish a couple tricks for those with a mortgage in Oregon to determine for themselves if those taxes are included in their payments.
The simplest way to calm those nerves and understand if the taxes are being paid by the lender or if they require you to actually cut a check to the county is to CHECK THE COLOR OF THE PAPER OF THE TAX BILL!
Fun fact- in Multnomah county tax bills, and I think also Clackamas county property tax bills if your taxes are included in your mortgage bill that tax bill document will be printed on YELLOW COLORED PAPER. If your bill needs to be paid separately by you it will be on GREEN COLORED PAPER! It took me about 10 years to catch on to this detail.
The second way to determine if your mortgage will or will not be paying those taxes for you is to study your monthly mortgage statement. Look in the total payment- It will show you the principal and interest that is due for that month's payment. IF you see another item in that monthly for "escrow"- this is the side account that you create throughout the year for the purpose of the LENDER paying your taxes for you.
Also, if you remember if you have an FHA loan, a USDA or a VA loan there is a virtual certainty that the lender will be paying the taxes for you. Those government backed loans never allow the taxes to be separated from the payments.