Rental Property Investor · Latham, NY · Member since 2020 · 74 posts · 12 votes
It's me again with another Newbie question...
I recently got approved for my first ever home loan it was a 0% down VA home loan of up to $275,000 and the lender said the taxes can only be up to $6,000.
Just curious as to why this is and what factors come Into play when accounting for how much is alloted for a "tax cap".
Specialist · Riverside, CA · Member since 2015 · 6k+ posts · 3k+ votes
6y
Probably just a safeguard for you taxes that high on a $275k home in NY seem like something may be wrong, so there shouldn't be much of a problem. As to why they have a cap at all, it could be to reduce their risk if they had to foreclose, but I don't know for sure.
Specialist · Riverside, CA · Member since 2015 · 6k+ posts · 3k+ votes
6y
Probably just a safeguard for you taxes that high on a $275k home in NY seem like something may be wrong, so there shouldn't be much of a problem. As to why they have a cap at all, it could be to reduce their risk if they had to foreclose, but I don't know for sure.
Saratoga Springs, NY · Member since 2017 · 30 posts · 14 votes
6y
@Aaron K. Being from the area, taxes are high here.
@Manasseh Arnold I don't know why, but one thought that comes to mind is that they calculated the maximum monthly payments that you are eligible for and if the taxes come back higher than $6k, your taxes due each month would push your total monthly payment over their maximum.
Rental Property Investor · Latham, NY · Member since 2020 · 74 posts · 12 votes
6y
@Ryan Allen that makes perfect sense I appreciate the feedback Ryan!
I'm currently in this process while deployed in the middle east but I'm from Greenwich, should be back in a few months. Just really looking for a good multifamily right now.
And hey since I have you here, I'm trying to build my "team" would you happen to know or be able to refer me a local quality CPA and attorney that has dealt with rental property investments... I know it's a shot in the dark lol but I figured I'd ask.
Appreciate any advice! And again thank you for your time Ryan.
Thank you for your service. The market is very active right now, it's pretty crazy.
I have not yet found a CPA to work with, I have a less than satisfactory experience with one so far. If you do find one, I'd be interested in hearing about one if you find one.
In regards to attorney's, that too I have thankfully not needed to use extensively to be able to make a recommendation.
Morris County, NJ · Member since 2020 · 5k+ posts · 2k+ votes
6y
@Manasseh Arnold
It's definitely for bounding your max loan. Remember, your loan amount is also dependent upon your property taxes. Pre-approvals are difficult to give since the rest of the expenses can't be controlled. Remember PITI
Principal
Interest
Taxes
Insurance
That’s the total payment the lender is required to make sure you can make...