Buying in Acworth and trying to make sense of property tax escrow? You’re not alone. Many buyers are surprised by how Cobb County and City of Acworth tax bills flow through a mortgage, why payments change after the first year, and what happens at closing. This guide explains the process in plain English so you can avoid shortages and last‑minute headaches. Let’s dive in.
Escrow basics: how it works
An escrow account holds part of your monthly mortgage payment to cover property taxes and homeowners insurance. Your mortgage servicer collects these funds and pays the bills when they come due. Some servicers may also collect for other recurring charges, but that is less common.
Federal rules under RESPA, enforced by the CFPB, set standards for escrow. Your servicer provides an annual escrow statement showing projected deposits and payouts, plus any shortage or surplus. Servicers can require an initial deposit at closing and keep a small cushion to prevent a negative balance. The cushion is typically limited to the equivalent of up to two months of escrow payments.
If your escrow is short after the tax bill is paid, your servicer will notify you. You may be asked to make a lump-sum payment or have the shortage spread over the next 12 months, depending on the servicer’s policy.
Cobb County and Acworth tax billing
Most properties in Acworth receive a single consolidated property tax bill issued by the Cobb County Tax Commissioner. That bill usually includes levies for the county, the city (if the home is inside Acworth city limits), the Cobb County School District, and any special districts or charges shown on the statement.
Georgia values property as of January 1 each year. Local assessors send valuation notices mid‑year, and millage rates are set later in the year after budget meetings. Many Georgia counties mail annual bills in the fall with payment due toward the end of the calendar year. Always check the latest mailing and due dates with Cobb County, since timelines can change.
If you plan to live in the home as your primary residence, ask about the Georgia homestead exemption through Cobb County. Qualifying exemptions reduce your taxable value. Incoming buyers must apply with the county and follow filing deadlines. Exemptions usually do not change a bill that has already been issued for the current year.
Some properties include special district charges, fire or stormwater fees, or other assessments. These items appear on the consolidated bill and should be reviewed during due diligence.
What happens at closing in Acworth
Closing attorneys and title companies confirm tax status and make sure any due and unpaid taxes are paid at closing so clear title is delivered. If the current year bill has not been issued yet, taxes are typically prorated based on the most recent bill or an estimate. The seller pays their share up to the closing date, and the buyer gets a credit for that amount on the settlement statement.
Daily proration is common. Whether the closing day is charged to the buyer or seller can depend on the contract and local custom. Confirm how your contract handles the closing date.
Example: tax proration
- Prior year total taxes: 3,650 dollars
- Closing date: July 10
- Seller days: 191 of 365
- Seller’s share: 191 ÷ 365 × 3,650 dollars = 1,911.52 dollars
In this scenario, the seller would credit the buyer about 1,911.52 dollars at closing. When the actual bill arrives, the buyer’s servicer pays it from escrow.
How lenders set up escrow at closing
Your lender will collect an initial escrow deposit at closing to build the balance needed to pay upcoming bills on time, plus a small cushion. The amount depends on the closing date, local billing schedule, and the loan program.
Example: initial escrow funding
- Estimated annual taxes: 3,650 dollars
- Monthly tax portion: 304.17 dollars
- If closing occurs four months before the tax payment, the lender may collect about 4 months of tax payments: 304.17 dollars × 4 = 1,216.68 dollars
- Cushion allowed by RESPA: up to two months, about 608.34 dollars
- Estimated initial escrow: about 1,825.02 dollars
Your lender will also begin collecting the monthly escrow portion with your first mortgage payment.
After closing: analyses, changes, and shortages
Once the servicer pays the tax bill, they run an escrow analysis to compare what was collected to what was paid. If taxes increased due to a higher assessed value or a new millage rate, your escrow may be short. Your servicer will notify you and explain your options. Surpluses over 50 dollars are typically refunded if the money is not needed for the coming year.
It’s normal for your monthly payment to change after the first analysis. Your escrow portion may rise or fall as the servicer updates estimates for next year.
Common surprises to avoid in Cobb County
- Using last year’s bill for estimates when the current year’s assessed value or millage increases, which leads to a larger actual bill.
- Assuming a homestead exemption is already applied. New owners must file. The exemption usually affects future taxes, not a bill that has already been issued.
- Receiving a seller credit based on last year’s bill, then seeing a higher actual bill and an escrow shortage after the servicer pays it.
- Buying new construction or a recently improved home that gets reassessed, leading to higher taxes than expected.
Buyer checklist before you close
- Get the most recent full tax bill and any current-year assessment notice.
- Confirm whether the property is inside Acworth city limits, since city millage may apply.
- Ask the seller if a homestead exemption is in place and request proof.
- Ask your lender for a draft escrow breakdown showing the initial deposit, monthly escrow amount, and cushion.
- Request a proration worksheet from the closing attorney so you understand the credits and charges.
- Confirm there are no unpaid prior-year taxes or special assessments during title review.
- For new builds or recent renovations, ask about any partial-year assessments or pending revaluations.
Seller checklist to stay on track
- Provide copies of recent tax bills and proof of any exemptions to the buyer and closing attorney.
- Resolve any due and unpaid taxes before closing or arrange for payment at the table.
- Review the settlement statement to confirm daily proration and your share through the closing date.
Quick tips for smooth escrow in Acworth
- Budget for changes. Your first escrow analysis often adjusts your monthly payment.
- Track deadlines. Georgia values property on January 1, and Cobb County typically bills in the fall. Verify the current calendar with the county.
- File homestead promptly after you move in if you qualify. It helps future years.
- Keep records. Save your tax bill, escrow statements, and closing documents so you can compare the estimates to the actual charges.
Your next step
If you want help reviewing a tax bill, estimating proration, or coordinating with your lender and closing attorney, reach out. Stout Property Group brings local experience in Acworth and across Cobb County to keep your move steady and predictable. Schedule a free consultation and get a clear plan for your next closing.
FAQs
How do Cobb County and Acworth property tax bills interact with my mortgage escrow?
- If you have an escrow account, your servicer collects funds with each payment and pays the consolidated Cobb County bill when due, which includes county, city (if applicable), schools, and any special district charges.
When does Cobb County usually mail property tax bills each year?
- Many Georgia counties mail in the fall with payment due toward year-end, but dates can change, so you should confirm the current-year mailing and due dates with the county.
How are property taxes prorated at closing for Acworth homes?
- Taxes are commonly prorated daily for the calendar year, with the seller paying their share through the closing date and the buyer receiving that amount as a credit on the settlement statement.
Why did my monthly mortgage payment change after the first year?
- Your servicer performs an annual escrow analysis after paying the actual tax bill, then adjusts your escrow portion based on updated estimates or any shortage or surplus.
What is the escrow cushion and why is it collected?
- Servicers may hold a small reserve to prevent a negative balance; under RESPA, the cushion is generally limited to the equivalent of up to two months of escrow payments.
Will a homestead exemption reduce my current tax bill after I close?
- New owners must apply for homestead with Cobb County, and while it can lower future taxes if you qualify, it usually does not change a bill already issued for the current year.
What happens if property taxes go unpaid on a mortgaged home?
- The county can place a tax lien and add penalties, but if your mortgage payments are current, the servicer typically pays the bill from escrow to avoid delinquency and tax sale risk.
