Prorations are credits between the buyer and seller at closing. They ensure that each party is only paying these costs for the time that they owned the home. They will show up as debits or credits on each party's closing statement. Prorations can be for costs such as: Homeowner's association fees.
How are taxes prorated at closing in Texas?
If taxes for the current year are not available for payment by the date of closing, then buyers get a prorated credit from the seller from January 1 to the closing date and the property taxes for the current year become the buyer's responsibility to pay once the bill is available.
Are property taxes prorated at closing in Texas?
In Texas, the property taxes are due at the end of the year. The taxing authorities will only accept payment from one entity. Therefore, when you sell or buy a home, the property taxes will be prorated at closing so that each party pays their portion of the year's taxes.
What are prorations in Texas real estate?
Prorated Bills for Sellers and Buyers
To put it in simple terms, the seller will be responsible for the property tax balance that accrued from the beginning of the tax year until the date of closing, and the buyer will be responsible for property taxes that are due for the period after the closing date.
What is prorated as of the closing date?
Proration is defined as the act of dividing property taxes, interest, insurance premiums, rental income, etc., between buyer and seller proportionately to time of use or the date of closing.
How are property taxes handled at closing in South Carolina?
SC PROPERTY TAXES are paid in arrears, so at closing, the SELLER pays the property taxes for the time the SELLER occupied the home for the current year; and the BUYER will pay the entire tax bill at the end of the year when it is due (before January 15).