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Back Taxes? 7 Steps Could Help Save Your Home

Biased property tax practices preserve white households’ wealth while making it easier to take away Black and Brown families’ homes.

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illustration of receipt exiting house, property taxes, finances
Mariah Llanes
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Paying property taxes can be a struggle, especially in the Black community where a slew of homeownership barriers persist.

It’s bad enough that median household incomes are lower for Black folks – making it tougher to keep up with taxes when life events such as divorce, job loss, or unexpected expenses happen.

But there’s another huge obstacle we face: the current foreclosure system in America.

Once you fall behind on property taxes, you’re liable to be slapped with a host of extra fees, interest charges, and legal costs that can often make it difficult, if not impossible, to catch up.

According to a 2022 University of Chicago study, harmful foreclosure practices nationwide impose severe additional costs on delinquent homeowners, disproportionately affecting those in Black and Brown neighborhoods.

According to a 2022 University of Chicago study, harmful foreclosure practices nationwide impose severe additional costs on delinquent homeowners, disproportionately affecting those in Black and Brown neighborhoods. These practices – which include aggressive tax liens and property tax sales to investors – not only exacerbate foreclosures, but they also accelerate disinvestment in communities of color, the researchers found.

That’s one reason it’s common to drive through some economically depressed neighborhoods and see a rash of unsold, vacant, or publicly owned delinquent properties.

Compounding the problem are inaccurate property valuations, which have led to a stream of unfortunate stories about Black people owning their homes for years – if not decades – and then losing their property through tax sales, even when past due taxes were less than $1,000.

Most cities or counties allow homeowners to enter into payment plans to gradually pay back overdue taxes over time. This prevents further penalties and fees from accruing while giving you breathing room.

“The racial wealth gap is not an accident—it is a policy failure rooted in white supremacy and enshrined in biased policy mechanisms that punish low-income and Black communities,” notes an August 2023 report from The Brookings Institution, “How the Property Tax System Harms Black Homeowners and Widens the Racial Wealth Gap.” In June, the Biden-Harris Administration announced measures to address racial bias in home valuations.

But families facing potential foreclosure need to take steps now. If you find yourself grappling with overdue property taxes, take a deep breath. This too shall pass: not just with prayer, but with a game plan too.

Here are seven steps to take to face your issues, save your home, and keep the roof over your head.

Step 1: Communicate With Your Lender

Reach out to your mortgage lender or servicer to explain your situation. See if they can offer solutions like temporarily breaking the amount you owe in taxes into smaller amounts to include with your monthly mortgage payment, refinancing to a lower rate, or establishing a payment plan. Typically, lenders will send you a “loan workout” package to complete, with forms and instructions. The sooner you call, the more options they will have and the better your chances of avoiding foreclosure.

If you’re helping someone else get out of a jam, such as an older neighbor or relative, be aware that many homeowners who lose their property to tax liens don’t even have mortgages.

Instead, these are typically long-term residents and retirees who have paid off 30-year loans, or people who inherited residences free of any home loans. For instance, data from Maryland’s tax department shows that properties sold at tax lien auctions almost never have mortgages. If there’s no lender involved, your next step is to contact local officials, like the city or county tax assessor. (See step 2).


Step 2: Explore Payment Plans With Your City or County

Most cities or counties allow homeowners to enter into payment plans to gradually pay back overdue taxes over time. This prevents further penalties and fees from accruing while giving you breathing room.

Different municipalities and counties have different policies; some allow 24 months while others may give you up to 7 years. Call the tax collector’s office to learn what’s available. With a payment plan, your home is safe from the auction block.

Step 3: Look Into Property Tax Relief Programs

Nonprofits and government agencies also offer property tax assistance programs in many states. Eligibility is usually based on age, income, disability status, or veteran status. The relief provided ranges from credits to deferments to even getting some taxes waived.

Do an online search for “property tax relief in [your state]” to see what’s out there. Every little bit helps when you’re in financial hardship.

Step 4: Seek Help From Community Organizations

Don’t be afraid to reach out to nonprofits and churches in your area. Some have funds set aside to help homeowners pay property taxes in emergencies. Others can connect you with resources or negotiate with the taxing authorities on your behalf.

People are willing to help, but you have to speak up and ask. Pride has no place when your home is on the line.

Step 5: Make Lifestyle Adjustments To Free Up Cash

Getting ahead of taxes requires dedicating as much money as possible to the cause. Take an honest look at your expenses. Are there subscriptions you can cancel or dining out costs you can cut?

Even small savings add up quickly when put toward your tax bill. Downsizing your lifestyle, even temporarily, can make a big difference. Focus on needs vs. wants.

Step 6: Consult With A HUD-Approved Housing Counselor

The U.S. Department of Housing and Urban Development (HUD) sponsors free housing counselors who can help create debt payoff plans, obtain mortgage assistance from lenders, and identify ways to pay property taxes. They have experience dealing specifically with tax delinquency issues and know available resources. Getting expert help maximizes your chances of bringing those property taxes current.

Contact the Consumer Financial Protection Bureau at (855) 411-2372 to be connected to a HUD-approved housing counseling agency in your area.

Step 7: Explore Financial Assistance Programs

Government and nonprofit programs exist to help those facing economic troubles. Some examples: HUD housing counseling assists with budgeting and taxes. LIHEAP provides heating bill assistance to free up your cash. Unemployment, welfare, and SNAP benefits allow you to direct more income to housing. Medicaid, ACA plans, and community clinics provide affordable healthcare options. Don’t let fear or embarrassment stop you from getting the help available.

So, if you’re behind on your property tax bill, yes, it’s stressful, but take a deep breath.

With some effort, outreach, and support, you can likely find an arrangement that works for your situation.

Follow Article Topics: Work-&-Money