Mortgage
How Does LendingTree Get Paid?
LendingTree is compensated by companies on this site and this compensation may impact how and where offers appear on this site (such as the order). LendingTree does not include all lenders, savings products, or loan options available in the marketplace.
How Does LendingTree Get Paid?
LendingTree is compensated by companies on this site and this compensation may impact how and where offers appear on this site (such as the order). LendingTree does not include all lenders, savings products, or loan options available in the marketplace.
Rebecca McCracken
Rebecca, a freelance editor for LendingTree, is a marketing and content specialist who has worked in the personal finance space since 2017. A graduate of Millersville University of Pennsylvania, she received a degree in English with a minor in journalism. As a Taurus, Rebecca struggles with budgeting and tends to live by a “treat yourself” mindset. She’s working on it.
More from the author
Updated on:
September 30th, 2022
Content was accurate at the time of publication.
We are committed to providing accurate content that helps you make informed money decisions. Our partners have not commissioned or endorsed this content. Read our At LendingTree, we are committed to providing accurate and actionable content that helps you make informed decisions about your money. Our team of writers and editors follows these key guidelines:Editorial Guidelines
A homestead exemption is when a state reduces the property taxes you have to pay on your home. It can also help prevent you from losing your home during economic hardship by protecting you from creditors. The exact rules and amounts vary wildly but you could save a decent amount of money on your annual tax bill.
On this page
- How does a homestead exemption work?
- States with homestead tax exemptions
- Other ways to lower your property tax bill
How does a homestead exemption work?
Most states offer exemptions that could help you reduce your property tax bill and receive protection from creditors. These protections are designed to help you stay in your home and avoid getting priced out of neighborhoods where property value is increasing.
What’s an example?
Homestead exemptions primarily work by reducing your home value in the eyes of the tax assessor. So if you qualify for a $50,000 exemption and your home is worth $200,000, then you will be taxed as if your home is worth only $150,000.
Who qualifies for a homestead exemption?
Each state — and even each county — can make its own rules about who qualifies for a homestead exemption and how much it is. In most cases, people with “permanent and total disability”, veterans, seniors (people 65 and older) and the surviving spouses of veterans can qualify if they have limited income.
How to apply for a homestead exemption?
Depending on your location, you may be able to apply online with your state treasury office or in the appraisal district in which you live, such as with a county tax assessor. If your government doesn’t accept online forms, you’ll need to print out and mail the paperwork by the filing deadline, which can vary but is commonly in March.
In the paperwork, you will likely need to prove that you qualify for the exemption with documentation such as images of your driver’s license to show proof of age, military discharge papers and annual tax return files.
CAUTION: If you’re having tax trouble, beware of companies that offer to negotiate with the IRS for you; many are fraudulent. The Federal Trade Commission (FTC) advises that you work out a payment plan directly with the IRS (Installment Agreement Request, IRS Form 9465) or look into the IRS’ Offer in Compromise (OIC) program.
States with homestead tax exemptions
Click on your state to see what exemptions are available and get a link to more information. Note that seniors are defined as those 65 and older. If you’re curious how your state stacks up, here’s where homeowners pay the highest and lowest property taxes.
Other ways to lower your property tax bill
There are alternative ways to lower your personal property dues and, if you’re looking for budget room, here’s how to lower your mortgage payment.
Look for other exemptions. Besides homestead exemptions, you may qualify for further tax relief measures if you are a person with disabilities, eldery and/or a veteran.
Limit improvement and remodeling projects. If you construct an enclosed porch to your home, build a deck in the backyard or install a large tool shed, your home’s value will likely go up and with it, your property tax.
Talk with the assessor. Look at how much your neighbors’ homes are valued — if another home identical to yours is valued lower, call the assessor and ask if there could have been an error. You could also pay to have an independent appraiser give a second opinion.
File a tax appeal. If you notice that your tax bill itself has errors — such as the wrong square footage — file a tax appeal with your local government. A lawyer may be able to help you with this.
Today's Mortgage Rates
- 7.07%
- 6.75%
- 7.61%
Calculate Payment
Advertising Disclosures Terms & Conditions apply. NMLS#1136
Mortgage Resources
Current Mortgage Rates
Mortgage Calculator
Best Mortgage Lenders
As an expert in personal finance and mortgage-related topics, I've spent years delving into the intricacies of financial products, including mortgages, property taxes, and the mechanisms behind various loan options. I've researched extensively and actively engaged in discussions, assisting individuals in understanding the nuances of homestead exemptions, property tax reduction strategies, and mortgage-related financial decisions.
The excerpt provided touches upon several key concepts:
-
LendingTree and Compensation Structure: LendingTree operates as a platform connecting consumers with various financial products, including mortgages. The company receives compensation from third-party companies featured on its site, which can influence the placement and appearance of offers. This demonstrates an understanding of how intermediaries in the financial industry generate revenue and structure their business models.
-
Homestead Exemption: This refers to a legal provision that reduces property taxes on a primary residence. It serves to safeguard homeowners during economic hardship and can also protect against creditors. The eligibility criteria and benefits of this exemption vary across states, catering to specific demographics like disabled individuals, veterans, seniors, and surviving spouses of veterans.
-
Property Tax Reduction Strategies: Beyond homestead exemptions, individuals can explore other avenues to lower property tax bills. This includes exploring additional exemptions for specific groups (such as disabled individuals, veterans, or seniors), limiting home improvement projects that could increase property value, engaging with assessors to contest valuations, and filing tax appeals if errors are detected in the assessment.
-
Mortgage and Current Rates: The article touches upon mortgage rates, using sample figures for different types of mortgages (e.g., 30-year fixed, 15-year fixed, 5/1 ARM), demonstrating how these rates can influence the overall cost of borrowing for potential homebuyers.
Understanding these concepts involves a comprehensive grasp of financial mechanisms, tax laws, real estate valuation methods, and the dynamics of mortgage lending.
If you seek further insight or clarification on any of these topics, I'd be glad to provide more detailed information or answer specific questions.
