By Scott Miller
Staff Writer

Many homeowners will ring in the new year with mortgage refunds and lower monthly payments in 2008.

Commercial property owners won’t share the same fortune, however. 

Statewide property tax reform that took effect in June replaced the portion of property taxes that fund schools with a 1% sales tax increase. The effect was cheaper property tax bills for homeowners last year. 

Homeowners who pay property taxes in their monthly mortgage payments overpaid last year because lenders were calculating bills based on prior-year taxes. This month, mortgage companies will begin evaluating escrow accounts and mailing one-time refunds, said David Krahn of First Rate Mortgage in North Charleston.

As an example, Krahn said, a taxpayer who had paid $2,000 annually in property taxes would get around $1,000 back.

Lenders also will recalculate homeowners’ monthly bills, likely creating lower mortgage payments this year, he said.

“In Dorchester County where I live, I’ve seen a reduction of about 30%, but I’ve heard in Charleston and other places that it’s been as high as 40% or 50%,” said Krahn, who also serves as president of the S.C. Mortgage Brokers Association.

Payments will vary widely based on home values, and some homeowners will only see “a couple dollars’ difference,” said Kirk Amerson of Universal Mortgage in Charleston. Some also will receive credits instead of refund checks, he said.

“I would assume the banks could hold the money in escrow accounts,” Amerson said.

Because that property tax relief was not extended to commercial property owners, many business advocates, including the Charleston Metro Chamber of Commerce, have said the act essentially shifted the tax burden to commercial property owners.

Sen. Luke Rankin, R-Myrtle Beach, prefiled legislation in December to form a legislative committee to consider extending property relief to more classes of property. Under the bill, the nine-member joint committee would report its recommendations to the General Assembly by Jan. 6, 2009.