What is a Texas property tax loan? •A property tax loan is a loan made to a property owner to pay the taxes on their real property.
The loan is secured by a lien against the property that the taxing unit transfers to the lender.
•The loan pays a property owner's complete tax liability, including any penalties, interest, and fees.
•The loan is funded by a third party lender, which is referred to as the Tax Lien Transferee.
The transfer does not create a new lien, but merely transfers the taxing unit's lien to the Transferee.
What are the advantages for the Property Owner? •Helps property owners protect their valuable real estate.
•Immediately stops the collection process by the taxing entity and eliminates any further penalties and delinquency fees.
•The tax loan provides flexible payment terms and repayment schedules designed to meet the borrower's needs.
•Allows commercial property owners to invest their capital into their business instead of making a lump sum payment.
•Creates time to overcome the financial problems that caused nonpayment of their property taxes.
What are the advantages for the Taxing Unit? •Allows for the taxing unit to collect revenue immediately.
•Reduces the burden and expense of collection and foreclosure.
•Improves overall collection rates, which decreases the burden on those taxpayers that do pay their taxes on time.
What are the advantages for the mortgage company? •Avoids creating an escrow account for the property owner.
•Avoids the expense of modifying or restructuring an existing loan.
•Eliminates the possible foreclosure by the taxing entity.