The current trend in rising business and consumer debt defaults may be leading to more delinquent property taxes as well. Where should our property tax bills be in our priorities?
Defaulting Debt
Although mortgage defaults, foreclosures and banks taking over properties have ended up being much lower than anticipated in the wake of COVID lockdowns and restrictions, some cracks are beginning to appear.
Forbearance programs, stimulus, and rising house prices have certainly helped stave off distress in this area. However, it seems that both businesses and individuals are falling behind on some of their other bills.
New bank data from DistressedPro shows recent spikes in late and defaulting business loans, auto loans and credit cards. There are now tens of billions of dollars in late and defaulted debt in these categories. Some categories have seen a 40% jump, and have seen performance declining for several quarters.
These trends could be further fueled by rising unemployment and inflation.
How We Pay Our Bills
Typically, when people get into a financial pinch they first fall late or stop paying their credit cards. If they still can’t keep up with their bills they end up falling late on their car loans.
If this still doesn’t solve their financial issues, then people fall behind on house and real estate payments.
This suggests that if trends keep on going in this direction, we could end up seeing more fall behind on property related payments.
Where Should Property Taxes Be In Your Priorities
When we fall into financial distress it seems that many overlook or believe that they can stretch out paying on their annual property taxes.
This can be a huge mistake. In fact, falling to pay your property taxes could lead to losing your home even faster than not paying your principal and interest mortgage payments. Especially in New York.
If you have to let some credit cards go, or can live without your car, that’s one thing. Though do everything you can to avoid falling late on taxes and property payments. With high interest penalties and other fees, it will only be increasingly harder to catch up.
What If You Can’t Afford Your Property Taxes?
If your financial situation has changed and you just don’t see it improving soon, then you may consider selling your property while you can, and finding somewhere more affordable to live.
However, it is also important to know that many annual property taxes are overinflated and incorrect each year. Property Tax Adjusters, Ltd. can help you assess your bills, get them reduced and perhaps help you save your property.