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Importance of Property Taxes
Those applying for jumbo mortgages — loans in excess of $424,100 in most parts of the country or $636,150 in higher-priced areas — are also likely to face high property taxes. Total Mortgage Services CEO John Walsh points out that most potential buyers are focused on interest rates but fail to look at property tax rates or include their prorated monthly insurance premium if it is being rolled into their monthly mortgage payment.
Income, Property Taxes and Insurance Premiums
Guaranteed Rate CEO, Victor Ciardelli, adds that potential borrowers who cannot show a steady income, such as those who are self-employed, must be especially careful to look at property taxes and insurance premiums because these two additions to the mortgage may make their debt-to-income ratio higher than most lenders like. This may force them to make a larger down payment in order to qualify for their mortgage.
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The Short Version
- Many forget to factor in property taxes and their monthly homeowner's insurance premium.
- Those applying for jumbo mortgages are also likely to face high property taxes
- Potential borrowers who cannot show a steady income, such as those who are self-employed, must be especially careful to look at property taxes and insurance premiums.