The lawyers at Kelly Guzzo have successfully litigated multiple cases where mortgage servicers have messed up escrow accounts for disabled veterans and the elderly. Even though many people are exempt from paying property taxes, mortgage servicers often force these consumers to pay estimated taxes into their escrow account, billing them hundreds of dollars each month that they do not owe.
Who is tax-exempt?
Tax exemptions vary by state. But, in most states, disabled veterans received at least a partial exemption on their real estate payments. Below are some of the property tax exemptions available in the Washington, D.C. metro area:
Virginia:
- The elderly, subject to income restrictions,
- Disabled individuals,
- Disabled veterans; and
- Surviving spouses of veterans, law enforcement personnel, firefighters, search and rescue personnel, or emergency medical services personnel who were killed in the line of duty.
Maryland:
- Low-income seniors;
- Disabled individuals; and
- Disabled veterans.
Washinton, D.C:
- 100 Percent Disabled Veterans,
- Disabled Active-Duty Service Members,
- Surviving Spouses of Military Casualties,
- Surviving Spouses of 100 Percent Disabled Veterans,
- Blind Persons; and
- People who require real estate improvements for their medical condition.
These senior and disabled veteran property tax exemptions are set by local governments, and you must apply for a tax exemption in the county or city where you live.
How tax exemption can lead to servicing errors
Once you have received a property tax exemption, mortgage servicers do not always apply the exemption to your account. Instead, they will continue to bill you for the “estimated tax” due on the property. This means that you will be charged hundreds of dollars more than you actually owe on your monthly statement.
Sometimes, mortgage servicers require you to submit proof of your exemption every year—a requirement that is onerous and not legally required. If you do not submit the exemption on time, the estimated tax is added back to your bill. You will typically see the increased amount when you receive your annual escrow statement.
Do you have billing errors caused by a property tax exemption?
It is important that you speak with an attorney at Kelly Guzzo if you see errors on your monthly mortgage statement related to a property tax exemption issue. We have successfully litigated many cases regarding tax exemption servicing issues, but it is important that you take the correct steps to preserve your legal rights. A mortgage is one of the most important loans you have, and any delinquency can have a devastating impact on your credit. We can help you navigate this issue to make sure that you are not being incorrectly charged for taxes that you do not owe, while making sure that the issue does not impact your credit score.
