Property Tax Loan FAQs
What is a property tax lien?
Your county places a tax lien on your property January 1st of every year to ensure payment of the taxes that will come due that year. The property tax lien is removed when you pay your property taxes at the end of the year.
If you don’t pay your property taxes in a timely manner, your taxing authority will add penalties and interest to your account. These fees can make your total amount due grow very fast. In the most extreme case it is the property tax lien that gives the county the authority to foreclose and take your property.
If you can’t pay your taxes, Ovation Lending can pay these taxes for you by providing a property tax loan. If you agree to let us pay your property taxes, the lien the county placed on your property will be transferred to Ovation Lending. You are then liable to Ovation for your property tax loan, but your loan payments will be considerably less than the penalties and interest charged by your taxing authority. Once your loan is paid, Ovation Lending will release the lien it has on your property, just as your taxing authority would, except you will have saved money by avoiding those high interest fees and stiff penalties.
How much can a taxing authority charge if I am delinquent on my property taxes?
If your property taxes become delinquent on February 1, you are subject to owing an additional 7% in penalties. An additional 1% is added each month until your taxes are paid.
In addition to the interest, if your taxes are still delinquent on July 1, an additional 20% collection fee is added to your tax bill.
If your taxes remain unpaid until December, the additional interest, penalties, and fees reach 44% and will keep growing until those taxes are paid. Of course, now a second year’s worth of taxes become delinquent and penalties on those new taxes begin.
Can my taxing authority foreclose on my property if my property taxes are delinquent?
The taxing authority can file a delinquent suit against you and could seize your property.
The longer you wait to resolve your unpaid property taxes, the greater the chance you will be sued.
If I choose Ovation, am I really getting a "loan"?
The term “property tax loan” is perplexing. A consumer loan is when you choose to borrow money to pay for something you want or need. Nobody wants to pay taxes!
When Ovation ‘lends’ money to pay your taxes, you are not creating a new debt. You are simply transferring your tax debt from the county to Ovation because we allow you to pay that tax debt in convenient, monthly payments. You also escape the enormous fees and penalties taxing authorities force you to pay when you can’t pay your property taxes.
Is a new lien being placed on my property?
The taxing authority has already placed a lien on the property. It automatically happens on January 1 every year. If you allow Ovation to pay your taxes, this tax lien is transferred to us.
Can you foreclose on my property if I miss a payment?
We provide easy, affordable payment plans for homeowners who cannot pay their property taxes according to the taxing authority’s schedule. We get the authorities off your back. We also work very hard to find a payment plan that fits your budget and financial situation. We cannot foreclose if you miss a payment!
However, if you stop paying and fall significantly behind, we have the right to pursue a foreclosure, just like the taxing authority can. If we are forced to begin that process you would receive many notices and would be given ample opportunity to rescue your tax loan to avoid the foreclosure. We never want to take your property.
If both the county and Ovation can foreclose on my property, why should I get a property tax loan with Ovation?
Ovation provides you more time and flexibility to pay your property taxes while avoiding foreclosure. We can provide a manageable plan that allows you to pay your taxes over a 10 year period, if necessary. Ovation works with you to find a solution in the event that you fall behind on your monthly payments. Our goal is to keep your property safe and secure in your own hands.
Can I change my mind after closing?
Texas law requires a three day grace period for all of our property tax loans. This serves as a “cooling off” period if you change your mind and want to cancel the loan.
I own several properties with delinquent taxes. Can you help me?
Ovation frequently helps owners of multiple properties. We can create different plans and schedule closings for all of your properties at the same time.
I have a mortgage on my property. Do I still qualify for a property tax payment plan?
Many of our borrowers have existing loans on their properties.
Are there other ways I can lower my property tax bill?
There are several types of “exemptions” written into Texas law that allows many people to lower their property tax burden. The most commonly used exemption is for your primary residence – your homestead. We can review your property tax record and assist you in determining whether you qualify for any of these exemptions.
Second, the county changes the appraised value of your property every year. We can assist you in learning how to navigate the ‘challenge’ provision so that the county does not over-value (and over-tax) your property.
You May Qualify for A Texas Property Tax Loan
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Your tax office may offer delinquent tax installment plans that may be less costly to you. You can request information about the availability of these plans from the tax office.
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