When making property tax adjustments on the HUD-1 for a home purchase loan, two issues come up. First of all, last year's taxes are based on the property before construction and the taxes are less than next years. Is it OK to disclose the tax adjustment based on last year's lower figure. Secondly, how do you know what the lot's taxes are when last year's taxes are based on the entire property which may include 50+ lots?

Have you tried a search on this? Sorry I haven't the time to look for it now but I know we had a discussion on this within the last year. Use my name or Dan Persfull as the poster.

I tried a search on both names and couldn't find anything addressing this issue. Thanks for looking at this. I appreciate your help when you get a chance.

What do you mean by "making property tax adjustment on the HUD 1"?

On page 1 of the HUD-1 under the section entitled "Adjustments for Items Unpaid by Seller" Items 210 and 211 are where you disclose the adjustment for taxes in the buyer's column. Items 510 and 511 are for the seller.

My question is how do you go about estimating the amounts disclosed in these spaces for a loan to purchase a tract house that has just been completed. Last year's taxes are based on the entire property which consisted of raw land, not the invidual lot with the newly constructed house being purchased.

Thanks

The best advice I can give is to call the assessors office and get an opinion from them, estimate it based on similar property (wouldn't your appraisal have comps) or if the tracts are evenly divided estimate by dividing the number of tracts into last year's assessment.