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How Are Property Taxes Handled at Closing?
(Santa Barbara Real Estate)
If you’re selling a home in Santa Barbara, one of the line items on your closing statement will be property tax prorations. The goal is simple: make sure the seller and buyer each pay property taxes for the portion of the tax period they actually own the home.
What Does “Prorated” Mean?
Proration just means “split fairly.” Escrow looks at:
● The tax period covered (for example, a six-month period)
● Your closing date
● How many days of that period belong to the seller vs. the buyer
Then they adjust the numbers so everyone pays their share.
Two Common Scenarios
1️⃣ Taxes not yet paid for the period If taxes are due later and haven’t been paid yet, the seller usually credits the buyer at closing for their portion. The buyer then pays the bill when due.
2️⃣ Taxes already paid in advance If the seller already paid taxes covering time after closing, the buyer reimburses the seller for the buyer’s share through escrow.
What About My Impound/Escrow Account?
If your lender collected taxes in an impound/escrow account, that’s separate. After your loan is paid off, your lender typically refunds any remaining balance directly to you.
How Etherton Real Estate Group Helps
At Etherton Real Estate Group, we:
● Coordinate with escrow and title
● Help you understand tax prorations on your closing statement
● Provide a seller net sheet so there are no surprises
Start with your free Santa Barbara home valuation and net estimate: 👉 https://www.ethertonrealestate.com/home_value
Learn more about Justin and our trust- and integrity-driven approach: 👉 https://www.ethertonrealestate.com/agent-profile/justin-etherton-13844616
(General information only; confirm specifics with your escrow officer or tax advisor.)
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