In a California property tax proration at closing, the escrow officer must prorate the property taxes between the buyer and seller. If a property sells on March 15, and the property tax fiscal year runs from July 1 to June 30, how many months of the current fiscal year has the seller occupied?
Correct Answer
A) 8.5 months (July 1 through March 15)
California's property tax fiscal year runs from July 1 to June 30. The seller has owned the property from July 1 (start of fiscal year) through March 15 (closing date). This is approximately 8.5 months. The escrow officer will prorate the annual tax: the seller is responsible for 8.5/12 of the annual tax, and the buyer is responsible for the remaining 3.5/12 (March 15 through June 30).
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Key Terms:
Related Concepts
A trustee sale is a type of foreclosure where a trustee, appointed under a deed of trust, sells the property at auction to satisfy the debt.
Usury is the practice of charging an interest rate that exceeds the maximum rate permitted by state law. Usury laws protect borrowers from excessive interest charges on loans.
A VA loan is a mortgage guaranteed by the Department of Veterans Affairs available to eligible veterans, active-duty service members, and surviving spouses. It offers no down payment and no private mortgage insurance requirements.
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