$5k in taxes were added for "GREATER NORTHSIDE MGMT D"

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$5k in taxes were added for "GREATER NORTHSIDE MGMT D"

Axel Norvell
Investor · Houston, TX · Member since 2019 · 66 posts · 58 votes

I own a property in Houston area code 77009, and the total property taxes for 2020 were $7,774.04.

However, my lender added a NEW additional tax for 2021 adding $5,574 to my tax obligations as shown below:

When I look at the the HCAD tax jurisdictions, I see this has always been a blank item going back for all past property tax records:

And when I look at past property tax bills, this line item has NEVER had an amount.

Does anyone in Houston familiar with property taxes have any idea what is happening here? I called my lender and they said that I was only paying $0.01 for that tax for 2020 which was wrong. 


In 2020, I did protest my taxes and get them lowered significantly. Is it possible that the $7k was reduced to $5k, and the lender got two bills and got confused?

The extra $5k tax was a huge surprise and increased my mortgage payment by $200 / month which is crazy.

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Ross Rauschenbach
Member since 2021 · 17 posts · 9 votes
5y

Hi Axel. I am a property tax consultant and Houston is my primary market. I believe that tax only applies to commercial properties in that jurisdiction, which is why it wouldn't show up on your tax statement since your property is classed A1 - single family residential. I believe your mortgage company has made a mistake and your escrow will likely be recalculated later this year when the 2021 tax bills are sent out. I could probably help you produce something stating your property isn't subject to that tax. 

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  • Ross Rauschenbach
    Member since 2021 · 17 posts · 9 votes
    5y

    Hi Axel. I am a property tax consultant and Houston is my primary market. I believe that tax only applies to commercial properties in that jurisdiction, which is why it wouldn't show up on your tax statement since your property is classed A1 - single family residential. I believe your mortgage company has made a mistake and your escrow will likely be recalculated later this year when the 2021 tax bills are sent out. I could probably help you produce something stating your property isn't subject to that tax. 

    3Reply
  • Axel Norvell
    OP
    Investor · Houston, TX · Member since 2019 · 66 posts · 58 votes
    5y

    @Ross Rauschenbach thanks for clarifying!

    What do you think I'd need to produce to the lender to avoid the $200+ increase to my mortgage payment for escrow?

    Obviously it's one thing to call and complain, but they're going to want to know 100% for sure the tax isn't applicable.

    Do I call HCAD and get them on the phone with my lender? Any insight on the correct process for disputing incorrect escrow amounts with the lender?

    0Reply
  • Ross Rauschenbach
    Member since 2021 · 17 posts · 9 votes
    5y

    You'll probably get a faster response by contacting the greater Northside management district directly. Their phone number is 713-229-0900. They can probably point you to the specific section of Code that limits their authority to commercial properties. To be clear, I don't know for certain whether the tax applies to you or not. You'll have to verify. If you need any help, let me know. 

    0Reply
  • Axel Norvell
    OP
    Investor · Houston, TX · Member since 2019 · 66 posts · 58 votes
    5y

    @Ross Rauschenbach thank you for the info!

    I reached out to Greater Northside District and they said my lender made a mistake. Residential properties are not taxed which is what mine is.

    I followed up with the lender and they're looking into fixing it.

    Thanks again!

    0Reply
  • Ross Rauschenbach
    Member since 2021 · 17 posts · 9 votes
    5y

    Glad I could help. Let me know if you need some help with future tax appeals. 

    0Reply
  • Dave Chapa
    Rental Property Investor · Katy, TX · Member since 2015 · 175 posts · 111 votes
    5y

    @Axel Norvell Glad it worked out for you.

    I went through a similar situation with my first house we built. The lender set up an escrow account, even though we were putting 20% down, and I did not realize until we were at closing. It would have delayed closing to change, so we went ahead and closed with the escrow account in place. Biggest mistake I made when buying that house. HCAD appraised the house wrong, that effected our escrow account by a significant amount, that greatly increased our payment by $450.00 a month. It took over 6 months to rectify the account, and almost a year to refund the money.

    It's become a practice to never include an escrow account in our RE investment and personal home. 

    1Reply
  • Axel Norvell
    OP
    Investor · Houston, TX · Member since 2019 · 66 posts · 58 votes
    5y

    Finally got them to remove the taxes that did not apply. But now having to go back again and have them fix the appraised value taxes which they have wrong.

    It seems kind of unfair and bad that the lender can so easily manipulate the escrow amounts without any quick-recourse for corrections.

    It's taking me over 2 months of constant follow up, emails and providing proof to get them to fix these issues. I know that I'll receive a refund for the overpaid escrow, but having the ability to increase mortgage payments by hundreds of dollars unannounced and incorrectly during a pandemic seems pretty ridiculous. 

    0Reply
  • Ross Rauschenbach
    Member since 2021 · 17 posts · 9 votes
    5y

    I hear this all the time in the property tax reduction business. I always have to warn people with mortgage issues that it can take a very long time to fix and you'll have to stay current on your unnecessarily large mortgage payment until the problem is resolved. This is the primary reason I don't take upfront fees. People come to me looking for relief, not another expense.

    Don't forget to file your property tax protests. The deadline to file is May 15th for most people. If anyone would rather a professional handle it, let me know ;)

    0Reply
  • Kwame Koom-Dadzie
    Investor · Humble, TX · Member since 2016 · 54 posts · 22 votes
    5y

    @Ross Rauschenbach, can you protest property taxes  on a vacant lot too ? & chances of success

    0Reply
  • Ross Rauschenbach
    Member since 2021 · 17 posts · 9 votes
    5y

    @kwame koom-dadzie

    Yes I can help you with a vacant lot. Chance of success depends on your lot and situation. I'd need to take a look to give you an estimate. 

    0Reply
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