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When borrowers fail to pay property taxes, allow their property to go into disrepair or miss scheduled mortgage payments, they could face loan default.
Property tax is a charge made on real estate that is owned by a person, a business, or another type of legal body. Property tax is most frequently a real estate ad-valorem tax, which is regarded as a regressive tax. It is computed by the local government in the area where the property is situated, and the owner is responsible for paying it. Usually, taxes are calculated based on the value of the assets that are possessed, including land. However, a lot of places additionally tax things like vehicles and boats that are tangible personal property. The local governing body will use the assessed taxes to pay for water and sewer improvements as well as for other community-beneficial services including libraries, law enforcement, fire protection, and road and highway building.
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