Is settlement costs paid at the closing of a house purchase final or are the property taxes reconciled at a later date?
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Is settlement costs paid at the closing of a house purchase final or are the property taxes reconciled at a later date?
At the closing of our house the previous owner paid us, as part of the closing costs, his estimated portion of the unbilled property taxes (this was several years ago). However, he has recently obtained the actual tax bills for the time period in question and is stating that he paid $216.11 more than was the actual cost of the property taxes at closing. He is requesting that we pay him the above referenced amount. Is this standard practice?
Asked on March 18, 2012 under Real Estate Law, Indiana
Answers:
FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
The closing statement following what the final escrow instructions state for the sale and purchase of real property control the issue with respect to accrued property taxes. As to your question, if the seller agreed to what as going to be assessed as to him for estimated owed property taxes with no documentation stating any entitlement to a refund of overpaid property taxes, then he is not entitled to any portion of the demanded $216.11 that you have written about.
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