Florida Tax Trap Don't Fall For It

The Florida Property Tax Trap: What New Homeowners Must Know

Buying a home in Florida is exciting but there’s a hidden trap that catches many new homeowners off guard. It’s called the Florida Property Tax Trap, and most people don’t see it coming… until they’re hit with a surprise mortgage payment increase months or even years after moving in.

Let’s break it down in simple terms—so you can avoid the headache.

Yes, You Always Pay Property Taxes Loan or No Loan

Whether you’ve paid off your mortgage, bought the house in cash, or just closed last month—you still have to pay property taxes every year.

If you have a mortgage, your lender likely collects your property taxes through an escrow account as part of your monthly payment. That includes:

• Principal

• Interest

• Property Taxes

• Homeowners Insurance

Sounds simple, right? Here’s where it gets tricky.

The Property Tax Trap (and Why It Catches So Many)

Let’s say you buy a home in July. The seller is responsible for the taxes from January 1 to June 30. You, as the buyer, take on the rest of the year.

But here’s what most people don’t realize:

Florida assesses taxes in arrears based on the previous year’s property value.

So your mortgage company uses last year’s (likely lower) property tax amount to estimate your monthly escrow payments.

That works… for now.

Why Escrows Blow Up: Looking Back vs. Looking Ahead

• Underwriters and title companies base estimates on the past year’s taxes.

• Smart loan officers use tools like your county property appraiser's tax estimator to forecast future taxes based on today’s purchase price.

So what happens if they only look backwards?

You start off with too little going into your escrow account. Then…

Your property gets reassessed at a higher value the next year.
But your escrow contributions are still based on the old, lower rate.
You're suddenly short by thousands, and your mortgage payment spikes.

Even Worse with New Construction Homes

Buying a newly built home? The trap is even deeper.

That first year, your escrow only collects taxes on the land not the home yet.

Let’s say:

• Land taxes = $1,200/year

• Actual home + land taxes = $5,000/year

You're only putting away $100/month, when you really need to be saving $417/month.

When the home gets reassessed the next year… 🎯 Boom. You’re $3,800 short. Your mortgage servicer will:

1. Increase your monthly payment to reflect the correct amount

2. Ask for the shortage in one lump sum (or spread it over 12 months)

That could mean $300–$500/month more on your mortgage out of nowhere.

How to Avoid the Trap

Let’s be real: the system isn’t perfect. Most title companies and underwriters stick to looking backward.

But you can protect yourself:

Step 1: Estimate Taxes the Right Way

Use your local property appraiser's tax estimator tool. It calculates taxes based on your new purchase price, not the old owner’s.

Step 2: Budget for Higher Escrows

If your lender can’t increase the escrow amount (because underwriting guidelines are tied to current assessments), then you take control:

• Open a separate savings account

• Deposit the difference each month

• Use that to cover future shortages

Step 3: Work with a Loan Officer Who Looks Ahead

A good loan originator will run the numbers for you upfront and help you plan for what your tax bill will be, not what it was.

Can You Fix It Later?

Yes but it can cost you.

Option 1: Refinance

• May let you roll the shortage into your new loan

• You’ll still need to qualify and pay closing costs

• Only works if you have enough equity

Option 2: Lump-Sum Payment

• Pay the shortage all at once

• Avoids a massive monthly increase—but can be a financial strain

Final Thoughts

It’s not your fault this trap is built into the process. But when you know it’s coming, you can plan ahead and avoid that gut-punch of a higher mortgage bill.

✅ Talk to a loan officer who knows how to forecast taxes
✅ Use the appraiser's estimator tool
✅ Save the difference yourself if needed

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Buying a home is a major milestone and borrowers deserve more than a one-size-fits-all loan. That’s where Ron Roberts with Amerifund Home Loans, Inc. comes in. As a trusted mortgage consultant, Ron takes a personalized approach helping clients navigate each step with clarity and confidence. From the initial consultation to pre-approval, and from selecting the right loan to closing day, Ron is committed to crafting financing strategies that align with each borrower’s unique goals, budget, and lifestyle. If you're ready to take the first step toward homeownership, connect with Ron Roberts for a tailored mortgage consultation. He'll help make the journey smooth, informed, and truly your own.

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Florida Property Tax Trap – FAQs

Q: Why are my property taxes so much higher after the first year?
A: Because your home was likely reassessed at a higher value, especially if you bought new construction or paid more than the previous owner.

Q: Can I ask the title company or underwriter to use future estimates instead?
A: Unfortunately, most don’t allow it due to their internal guidelines—but you can plan for the difference yourself.

Q: What happens if my escrow is short?
A: Your servicer will either ask for the shortage in a lump sum or increase your mortgage payments over 12 months.

Q: Can refinancing fix the problem?
A: It might help—if you have enough equity and can absorb the closing costs. But it’s best to plan ahead from the beginning.

Q: What’s the best way to estimate future property taxes?
A: Use your county property appraiser’s tax estimator tool based on your new home’s purchase price.

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