Lew Sichelman
Homeowners may be able to find some relief from rising property taxes and insurance premiums – without doing much work in the process.
There are companies that will review your tax assessment and insurance coverage to make sure you aren’t overpaying. If your house is over-assessed, they’ll file a protest on your behalf, and if your insurance can be tweaked to save a few bucks, they’ll tell you how.
Of course, you can also do all this on your own.
Lower Your Property Taxes
Estimates vary, but according to the nonprofit National Taxpayers Union, anywhere from 30 percent to 60 percent of all properties are over-assessed. The good news is that the appeals process is relatively simple in most places, though every jurisdiction has its own criteria and deadlines.
Start by doing the math: Multiply the tax rate by your home’s assessed value. Say the rate is $1.50 per $100 of assessed value; for a house valued at $300,000, the math works out to $1.50 times $3,000, for a total of $4,500 in property taxes. If your arithmetic doesn’t match the tax man’s, ask them to recompute.
Next, ask for a copy of your assessment record, a.k.a. worksheet or appraisal card. The record will list everything the assessor believes contributes to the value: location, size, amenities and so forth. Mistakes are not uncommon, so look for errors: They may have you down for four bedrooms when you only have three, or a 1-acre lot when it’s actually half that. Any discrepancy in your favor will likely lead to a lower assessment.
Next, gather proof that you have been assessed unfairly. Similar properties should end up with similar assessments, so find out which houses yours was compared with. Check them out to see how they differ: Does one have a two-car garage, contrasted with your home’s carport? Is the other place all brick, while yours is clad in aluminum siding?
Another option is to hire your own appraiser, then see how their impression stacks up against the tax assessor’s. Have your appraiser look at a few comparables, too.
If you don’t feel up to the task, there are plenty of local outfits that will do this legwork on your behalf. Or you can link up with a national company like Incenter Tax Solutions, which works to appeal property tax assessments for homeowners.
While smaller, local companies usually charge a fee, Incenter charges nothing to review a case, and there is no charge if the appeal is unsuccessful. If the company wins the appeal, the charge is half of your first year’s savings. Every year thereafter, the savings are yours to keep.
Save on Homeowner’s Insurance
Incenter Insurance Solutions, a sister company of the tax outfit mentioned above, also operates on a national basis, with licenses in all 50 states. And it, too, offers complimentary reviews – in this case, of your insurance needs – to find you the best value for your dollar.
Of course, Incenter is not the only option, so look for the best deal on your own. Shop till you drop, narrowing down your choices based on the companies’ fees (if any), service quality and financial stability. Once you have a couple of options in mind, ask for specific price quotes – just make sure you are comparing apples to apples, with the same coverages and deductibles.
When you are placing a value on your property for insurance purposes, remember to exclude the value of the lot it sits on. After all, it’s your house, not the land under it, that needs insurance protection.
Another way to trim your costs is by raising your deductible. If you can increase it from $500 to $1,000, you could trim your premium by as much as 25 percent. Just make sure it’s an amount you can still comfortably afford, should you have to file a claim.
Also, consider bundling your homeowners policy with your automobile and other coverages with the same carrier. Combining two or more policies might cut your premiums by a decent amount. But make sure the combined price is lower than separate policies with different carriers.
Think proactively: Ask your insurer what you can do to make your house more resistant to natural disasters. Adding storm shutters or reinforcing your roof, for instance, may save you some money. Ask about discounts for smoke detectors, alarm systems and deadbolt locks. Some companies offer discounts of up to 20 percent.
Some insurance companies also offer price reductions to retirees. If you are at least 55 and no longer working, it’s worth asking.
Of course, establishing and maintaining a good credit record is key to cutting your insurance costs. Insurers almost universally use credit scores to price their policies.
Lew Sichelman has been covering real estate for more than 50 years. He is a regular contributor to numerous shelter magazines and housing and housing-finance industry publications. Readers can contact him at lsichelman@aol.com
