New Tax Loan Restrictions

If you have relied on a property tax loan in the past and plan on doing so again next year for your 2013 taxes, you may not be able to so prior the assessment of the January 30th penalty. Thanks to Senate Bill 247, which was signed into law by the Governor on 5/30/13, most property owners are now restricted from obtaining a property tax loan until such time as their taxes are delinquent. Prior to the new law, you were exempt from this restriction if you had a preexisting tax loan or did not have a mortgage. Going forward, you are only exempt from obtaining a tax prior to the January 30th penalty if you do not have a preexisting mortgage on your property.
So if you are like most people, you are asking yourself why do our politicians care about this and why did they go to the trouble of passing this new law. Well the bill was supported by tax assessors who counties are starved for additional revenue and big banks that want to push their customers into escrow accounts for nonpayment of real estate taxes.
The bottom line is that you can still obtain a property tax loan prior to January 30th if you do not have a mortgage on your property. If you do have a mortgage, your must wait until February 1st. You will incur the 7% penalty, but will still save yourself the 36% in penalties and collection charges that accrue February 1st through December 30th.