Unpaid past-due property taxes that can affect title clearance, closing funds, and mortgage servicing.
Delinquent property taxes are property taxes that are past due and unpaid.
Delinquent property taxes matter because unpaid taxes can create serious closing, title, and servicing issues. A lender usually needs to know whether taxes must be paid at closing, cleared from title, or handled through escrow.
They also matter because tax claims can have priority or enforcement consequences that are different from ordinary unsecured debts.
Borrowers may encounter delinquent property-tax issues during title search, tax certificate review, refinance payoff review, purchase closing, or servicing. The settlement agent may require payment from seller proceeds or borrower funds before closing can complete.
The term becomes practical when tax records show an unpaid bill that must be resolved before the new mortgage is safely secured.
A refinance title review finds unpaid property taxes from the prior year. The lender requires the delinquent taxes to be paid through closing so the new loan does not close with an unresolved tax issue.
Delinquent property taxes differ from Property Tax Bill because the bill may be current, while delinquent taxes are past due.
They differ from Tax Lien because delinquent taxes are the unpaid obligation, while a tax lien is a recorded or legal claim that may result from unpaid taxes.
They also differ from Property Tax Escrow because escrow is the account used to collect and pay taxes, while delinquency is a failure or gap in payment.