Purchasing a home with your spouse is an exciting time when you can have a place to call your own, decorate as you please, and gain more stability for your family. When taking out a home loan with your spouse, you should know what you’re responsible for and what the laws in your state say […]
Understanding Your Home’s Assessed Value
The payments on your KC home loan are, in part, determined by taxes. To help calculate what you owe in taxes, your property’s assessed value is taken into account. But what exactly is assessed value and how does it affect you and your home?
At its core, assessed value is used to determine:
How is Assessed Value Determined?
The assessed value of a property is determined annually by professional assessors. The assessors come into a neighborhood and evaluate property conditions there as a whole before moving on to individual homes. As they assess your property, they will keep written records of the assessment in case there are any disputes. The process of assessing homes helps authorities:
- Plan budgets
- Provide services like sanitation
How Does Assessed Value Affects You?
Your home’s assessed value can change from year to year based on the annual assessments. If you choose to sell your home, you will notice that its assessed value will differ from its fair market value. In fact, it is often lower. The price difference is caused by what your home is worth on the market compared to what it was assessed for.
This difference is normal. Assessed value is merely used to determine how much you owe in property taxes and, in turn, on your home loan in KC.
Assessed Value & Property Tax
Assessed value is one of the factors that determines your property tax. Other factors include:
- Property tax rate
- Qualified exemptions
Your property tax rate, or mill rate, is the amount of tax payable per dollar of the property’s assessed value. The rate is determined by multiplying the assessed value and the mill rate and dividing by 1,000. Your property tax is also based on what your property is used for. Each category can be taxed at different rates.