Investopedia

Continue to Site »

Tax Service Fee

Filed Under » ,
Dictionary Says

Definition of 'Tax Service Fee'

A legitimate closing cost used to ensure that mortgagors pay their property taxes. A tax service fee is typically paid by the buyer at the time the home is purchased, the lender then passes this sum on to a tax service agency. The role of a tax service agency is to look for delinquent property taxes and alert the mortgage company to prevent tax liens from existng against their mortgagors' homes. Since tax liens have priority over lender liens, banks wants to ensure that they, not the state, become the owner of these properties.
Investopedia Says

Investopedia explains 'Tax Service Fee'

For borrowers with impound accounts, property taxes are collected monthly with mortgage payments; in this case, the tax service agency's job is to provide the lender with your property tax bills so that they will be paid on time. For borrowers without impound accounts, the mortgage company will often remit any unpaid property taxes on behalf of the homeowner and then bill him or her for the sum, plus penalties and fees.

Articles Of Interest

  1.

    Mortgage Points: What's The Point?

    Learn how to pay less for your home in the long run, or save in the short run.

  2. Mortgages: How Much Can You Afford?

    Answering this means number-crunching as well as factoring in other considerations and expenses.

  3. Home-Equity Loans: The Costs

    Learn the factors to consider when comparing the different programs offered by various lenders.

  4. 4 Steps To Attaining A Mortgage

    It starts with knowing your choices as well as your price range. We show you how to get there.

  5. Understanding The Mortgage Payment Structure

    We explain the calculation and payment process as well as the amortization schedule of home loans.

  6. Has Income Tax Become A Class Tax On The Poor?

    With more than 33% of American families falling close to the poverty line despite their adult members holding full-time employment, a rising number of citizens are being forced to pay a rate ...

  7. Possible Effects Of The Online Retail Tax

    The U.S. Senate has passed a bill that will impose a sales tax on online retailers. Discover how the Marketplace Fairness Act could affect your bottom line.

  8. How To Get The Most Out Of Hiring An Accountant

    When you hire an accountant, getting good tax advice going forward is as valuable as – or perhaps even more valuable than - getting the previous year’s taxes filed correctly. Learn what you need ...

  9. How The 2014 Obama Budget Could Affect Your Finances

    Depending on which estimate you believe, Obama's proposed budget would raise the tax bill of a household with a yearly income of $50,000 to $75,000 between $63 and $100 per year. However, that’s ...

  10. Inaccurate Tax Return, Now What?

    If the IRS finds errors, it will cost you. Find out how to fix them, and how to prevent them in the first place.
comments powered by Disqus
Marketplace
Hot Definitions

  1. Disaster Loss

    A special type of tax-deductible loss, similar to a casualty loss, where a loss has been incurred by taxpayers who reside in an area that has been designated as a federal disaster area by the President.

  2. Fool In The Shower

    The notion that changes or policies designed to alter the course of the economy should be done slowly, rather than all at once.

  3. Pattern Day Trader

    An SEC designation for traders who trade the same security four or more times per day (buys and sells) over a five-day period, and for whom same-day trades make up at least 6% of their activity for that period.

  4. Cost-Push Inflation

    A phenomenon in which the general price levels rise (inflation) due to increases in the cost of wages and raw materials.

  5. Happiness Economics

    The formal academic study of the relationship between individual satisfaction and economic issues, such as employment and wealth.

  6. Affluenza

    A social condition arising from the desire to be more wealthy, successful or to "keep up with the Joneses." Affluenza is symptomatic of a culture that holds up financial success as one of the highest achievements.
Trading Center