Real Estate

What happens if you don't pay property taxes in Ontario?

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jacksorbetta wrote: No, it's terribly low. But on the flip side, I'd rather not do a financing situation with the city directly. I live on a pretty strict budget (remember I have cancer, and only just returned to work last month off being off for 3/4 of a year). I need the discipline of regular contributions or I'd be scrambling to pay my full tax bill.
In Toronto, the city gives you the option to directly pay them and to spread your property tax bill over 12 monthly payments, instead of only when they are due.

And even if you don't take this option, the regular payment system is spread over 6 payments. First 3 payments are done over 3 months in first half of the year, based on previousu years taxes. Second 3 payments are done in last half of the year, based on actual property taxes for that year.

They don't even give the option to just pay once per year (or if they do it's some non-advertised way).
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TripleHelix wrote: I tend to agree. People have these types of discussions all the time. It would have resolved itself between the two of them eventually. Not sure why this whole talking to a mod attitude had to be brought into it.
Because we don't take kindly to users being rude and disrespectful to us. ;) It's covered in the forum rules BTW and can result in an immediate ban. If you only knew the crap we are subjected to, you'd understand the stance we take on this. It wasn't me either who swung the ban hammer but another Mod.... I admit I was close though. :D
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Jan 20, 2009
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Typically, around GTA, lenders only collect tax payments when the mortgage is insured. Exceptions are lenders like Home Trust and First National.

As for providing yearly proof, I had clients who were delinquent for 2-3 years and only cleared property taxes on sale or refinance and the lender had no clue because they kept up mortgage payments.
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May 17, 2007
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BC Taxes allow you to pay in several ways. You can pay in one chunk before July 1st (or face a penalty + 5% interest immediately)
-monthly withdrawals (yay to finance charges?), between Aug 5-May 5th. 10 payments only
-automatic tax due date withdrawal (you better have it in the bank!)
-installments through your mortgage
-pay by credit card through the city's 3rd party program. worst choice yet lol

Remember I work for a bank. I see every variety of financial management you can imagine. The majority of clients are not very organized. If they had to pay taxes themselves, it would get ignored probably.
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casey5 wrote: Typically, around GTA, lenders only collect tax payments when the mortgage is insured. Exceptions are lenders like Home Trust and First National.

As for providing yearly proof, I had clients who were delinquent for 2-3 years and only cleared property taxes on sale or refinance and the lender had no clue because they kept up mortgage payments.
Thank you.

I don't see what the big brouhaha about this is. What I have seen is a my brother who every June, makes a withdrawal on his HELOC to pay his property tax. Instead of spreading it out over the year interest free, he chooses to pay it himself and accrue finance charges of whatever his rate is. No amount of explainin' has sunk in. They are not broke. But that's how they do things.
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Sauerkraut wrote: I find this statement rather disconcerting. Now I have no love lost for the particular poster in question, but by temp banning him/her, the mod(s) posting in this thread are just flaunting their authority.
While being condescending towards a mod didn't exactly earn him any praise, it wasn't what got him banned. Constant attacks towards another user did, despite repeated warnings.
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CSK'sMom wrote: Because we don't take kindly to users being rude and disrespectful to us. ;) It's covered in the forum rules BTW and can result in an immediate ban. If you only knew the crap we are subjected to, you'd understand the stance we take on this. It wasn't me either who swung the ban hammer but another Mod.... I admit I was close though. :D
I agree this applies in the case of a moderator asking someone to respect the rules or when giving a warning to users as a whole and getting flack back for it.

When a mod partakes in a conversation and provides an opinion that may be controversial or up for discussion, why should you expect more respect from users just because you are a mod.

More serious things are going on in squabbles between Mark77 and Donnie in other threads and no bans have resulted from it, I guess because Mark77 isn't a mod?

I do sympathize that you guys/gals have to deal with a lot of crap, but when you are coming into a thread giving your opinion, you should somewhat be doing so as a regular user vs doing so as a mod and all the respect that should come with it :)

I do agree with the ban of Donnie though. I think he had it coming and I thought it would of happened in another thread already.

*Edit* and Shaner confirmed it was indeed the adding up of all this that got him the ban
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rob444 wrote: On any surplus tax payments made to the lender, don't they give you a paltry 1% interest rate or something on it? I'm sure the lender is making much more in the background. Unless they actually dedicate that money specifically to your taxes and don't use it for other lending? Either way... it's in the home owners best interest to NOT have to pay a surplus on taxes and just do it themselves.

Although I really can't understand why some lenders push to control taxes, especially for low risk borrowers not using CMHC. Are there that many liens from municipalities that are causing lenders problems? The only thing I can think of, is that the lenders are profiting from the surplus before taxes are actually due.
It's really a moot point for me. My property taxes are $2400 for the year, due in 3 different installments. Realistically, how much money am I really going to save by paying the taxes myself rather than having them paid through my mortgage? I'll have a very small amount of extra money I could invest I guess, but what kind of short term investment guarantees any kind of real returns? It's such a small amount of money that would be saved that I simply don't care. I'm more than happy to let my mortgage company pay it on my behalf.
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TripleHelix wrote: I agree this applies in the case of a moderator asking someone to respect the rules or when giving a warning to users as a whole and getting flack back for it.

When a mod partakes in a conversation and provides an opinion that may be controversial or up for discussion, why should you expect more respect from users just because you are a mod.

More serious things are going on in squabbles between Mark77 and Donnie in other threads and no bans have resulted from it, I guess because Mark77 isn't a mod?

I do sympathize that you guys/gals have to deal with a lot of crap, but when you are coming into a thread giving your opinion, you should somewhat be doing so as a regular user vs doing so as a mod and all the respect that should come with it :)

I do agree with the ban of Donnie though. I think he had it coming and I thought it would of happened in another thread already.
I am the one that banned him and it had nothing to do with his posts towards the other mods in this thread. He was getting banned whether those mods participated in this thread or not, and his ban wasn't just the result of this thread. It was the result of numerous posts over a long period of time and repeatedly ignoring warnings, infractions, deleted posts, locked threads, etc.

So hopefully that puts your concern to bed in this specific case.
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Not once in this thread have I wielded the mod hammer. I'm posting as myself. I expect a modicum of respect based on being a fair contributor to our website... not as a mod. Every poster deserves to be treated fairly.
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jacksorbetta wrote: BC Taxes allow you to pay in several ways. You can pay in one chunk before July 1st (or face a penalty + 5% interest immediately)
-pay by credit card through the city's 3rd party program. worst choice yet lol
Hmm if they don't charge extra for this, and you can get credit card rewards for tax payments, this would actually be the best option!

I know Canadian Tire credit card lets you pay some bills as a credit card purchase (not cash advance), and to get CT rewards. I believe some (not many) municipal tax accounts are on their approved list of payees, giving a further incentive to pay on your own.
The majority of clients are not very organized. If they had to pay taxes themselves, it would get ignored probably.
Ya and other than the lenders using your surplus payments to make their own interest, this is the main reason I can see for them to force this option. Protecting people from themselves.
Shaner wrote: It's really a moot point for me. My property taxes are $2400 for the year, due in 3 different installments. Realistically, how much money am I really going to save by paying the taxes myself rather than having them paid through my mortgage? I'll have a very small amount of extra money I could invest I guess, but what kind of short term investment guarantees any kind of real returns? It's such a small amount of money that would be saved that I simply don't care. I'm more than happy to let my mortgage company pay it on my behalf.
Very true, I guess lots is personal preference. In my case my first ever mortgage was with PC Financial, and even into the 2nd year they kept messing up the tax payments. Also I like to be in control of every payment I make, no matter how small it may be, so much prefer doing my taxes directly to the city myself.
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Ontario
jacksorbetta wrote: Thank you.

I don't see what the big brouhaha about this is. What I have seen is a my brother who every June, makes a withdrawal on his HELOC to pay his property tax. Instead of spreading it out over the year interest free, he chooses to pay it himself and accrue finance charges of whatever his rate is. No amount of explainin' has sunk in. They are not broke. But that's how they do things.
I know, right? Unfortunately, most people I know start out with the best of intentions, thinking they could keep up with something as simple as 2-3 payments/year then they procrastinate.

First thing I did when I received my first property tax bill was to fill out the pre-authorized payment form :) No extra fee and 6 payments are spread out over 12 months, everyone's happy.
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jacksorbetta wrote: Not once in this thread have I wielded the mod hammer. I'm posting as myself. I expect a modicum of respect based on being a fair contributor to our website... not as a mod. Every poster deserves to be treated fairly.
Understood jacksorbetta. I never intended for it to seem as though I was saying you weren't posting as yourself.

My comments were mostly towards CSK coming in with the whole "respect the mods" attitude.
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TripleHelix wrote: When a mod partakes in a conversation and provides an opinion that may be controversial or up for discussion, why should you expect more respect from users just because you are a mod.
Yes, that was my point. If a user is being rude, then they should suffer the consequences...no matter whom it's directed at.
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CheapFinds wrote: Is it the same as a 15%/yr* interest rate loan, but it doesn't go in your credit report, so it doesn't affect your credit rating?

*1.25%/month penalty (Ottawa, Toronto).
+Admin fees

Toronto Star says: "the municipality can seize your property and sell it to recoup the taxes, although this is a long and seldom-used process that often takes years."http://www.thestar.com/business/persona ... _know.html

See also:
Short of cash? Stop paying your property taxes
"Hey, seniors, there’s a banker out there ready to provide you with a low interest rate loan. That loan company is the government."
http://business.financialpost.com/2013/ ... rty-taxes/
Did OP's answer get answered?

Here are some of comments ...

1) Yes ... you could not pay property taxes for over a year. The city will send out late notices and keep adding on the total with interest.
2) At some point , the city (at least Toronto) does get a little nastier and sends out a threatening letter (when you haven't made a single payment tax for 1 calendar year, I think.)
3) At what point, does the city actually launch legal action? Not sure ... but I'd imagine it needs to be a good amount of money owing, like $20K - $50K. They want wouldn't do it to recover just $5K of taxes.
4) Do they send out a letter to the bank holding the 1st mortgage? It would be a great and cheap way for the city to get it's money instead of going the liens route and getting nothing, except court and legal costs. (As most mortgages are written so the banks can pay taxes and be in control.)
5) If you don't have a mortgage ... then the easy option is take away from the city.

On the bank side. A bank would want to protect their mortgage. I seem to recall signing or being told, the bank will step in and pay outstanding taxes, then I will have no choice, the bank will pay property taxes from then on, and it would be reflected in the new monthly payments. (something like that.)

I also would caution RFDers, that each municipality would likely deal with things differently.

I know in small townships, where everyone essentially knows everyone's business. The city just grins and bears the unpaid property taxes. They know the folks, and may know of the family's hardships. They do not want to kick the family out of their house, or take food away from the table. (I've listened to finance people in these municipalities, and they are quite decent and try to take care of their residents.)
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Dec 16, 2004
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I can't speak about the current process but I remember personally processing an outstanding property tax bill payment for a property that was multiple years in arrears as the bank held the mortgage. It was explained to me that the bank would not allow anything to supersede their claim on the property and property tax were the only thing that could "go ahead" of the mtg. It's covered in the mortgage agreement as "protecting" their claim or whatever wording. The payment was added to the principal balance of the mortgage.
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TripleHelix wrote: Understood jacksorbetta. I never intended for it to seem as though I was saying you weren't posting as yourself.

My comments were mostly towards CSK coming in with the whole "respect the mods" attitude.
You don't know the whole back story with Donnie to begin with. As Shaner already stated, he has repeatedly been privately dealt with. I certainly don't sit back and do nothing when another Mod is being disrespected in a thread I am participating in. We don't ignore rule violations. And you have to admit, that was pretty flagrant on his part...
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Mark77 wrote: No, the bank will pay it if one has a mortgage. And add it to your mortgage balance. And probably charge you a fee for doing so. Technically one is actually in default of a mortgage if they do not pay the property taxes on-time.
Sorry Mark, but your claims that purport the mortgage holder of a property will step in and pay tax arrears are, as one member vociferously noted, in fact, completely incorrect and false.

On two occasions over the past 15 years, we have been in a position of running 3 years past due on municipal taxes owing, and in neither case (four cases actually, as both times we were behind on two properties) did either of our banks step in and pay up the taxes on our behalf, then add them to our mortgage, as you claim they do. In all four cases, we were notified that failure to pay arrears would subject us to the possibility of the seizure and sale of our properties.

The mortgages were (and still are) held by BMO and TD Canada trust. In the case of one property, the tax sale process was actually initiated by the municipality, even though I had begun payment arrangements for that property in question. Even in that specific case, the mortgage holder was not notified by the action taken by the municipality
Mark77 wrote: They add it to the mortgage, or they call the mortgage in default. That's why your property tax statement probably even has the name of the bank you have the mortgage with on it -- so the City can notify the bank if their first-lien position is at any risk of being subordinated.
I was curious about this, as for as long as I can remember, we have paid municipal taxes and mortgages seperately. Looking at my latest "The Corporation of the Township of Madawaska Valley" Tax Bill, I see it says Mortgage ref. as well as Mortage Company, however the fields for this information are blank!

Based on anectdotal evidence, I would also suggest the bolded statement by Mark should also be considered incorrect, even given the caveat "probably" that was used.
"The truth is incontrovertible, malice may attack it, ignorance may deride it, but in the end; there it is."
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fieldhousehandyman wrote: Sorry Mark, but your claims that purport the mortgage holder of a property will step in and pay tax arrears are, as one member vociferously noted, in fact, completely incorrect and false.
No they are not. As other posters have noted.
On two occasions over the past 15 years, we have been in a position of running 3 years past due on municipal taxes owing, and in neither case (four cases actually, as both times we were behind on two properties) did either of our banks step in and pay up the taxes on our behalf, then add them to our mortgage, as you claim they do.
Did you have a very substantial equity cushion? Did they go so far as to register a lien?
I was curious about this, as for as long as I can remember, we have paid municipal taxes and mortgages seperately. Looking at my latest "The Corporation of the Township of Madawaska Valley" Tax Bill, I see it says Mortgage ref. as well as Mortage Company, however the fields for this information are blank!
Yeah probably a low ratio mortgage you had on such, where there was no particular reason for the lender to worry about subordination of their security interest.
TodayHello wrote: ...The Banks are smarter than you - they have floors full of people whose job it is to read Mark77 posts...

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