Property Tax Definitions


APR, or Annual Percentage Rate, is the actual annual cost of borrowed funds expressed as a percentage. APR differs from interest rate because it includes all fee’s associated with closing a loan.

Appraisal District

The appraisal district for each county, led by a chief appraiser, is tasked with conducting an appraisal of your property each tax year.

Appraised Value

An evaluation of a property’s value at a given point in time. This value is calculated by a professional appraiser or, for purposes of property taxes, an appraisal district. The appraised value of your home, multiplied by the tax rate for your county, determines your tax liability.

Debt to Income Ratio

DTI is a measure used to evaluate a borrower’s ability to repay. The metric divides a borrower’s debt obligation by their current income.

Deed of Trust

The document that pledges your property as security for the loan. This document permits a lender to foreclosure if you fail to make monthly payments.


A building occupied by the owner of the freehold and his or her family, with the primary intention of making it their home, together with the parcel of land on which it stands and the other improvements attached to it.

Travis County Tax Office,, 2017

HUD 1 Settlement Statement

This document details all costs involved with the loan. The HUD 1 will include any charges paid or owed by the borrower to the seller, the mortgage company, or any other third party involved.

Interest Rate

The portion of a loan that is charged as interest to the borrower. This figure, typically expressed as an annual percentage, is otherwise considered the cost of borrowing.


The legal right to take or hold property of a debtor as payment or security for a debt.

Travis County Tax Office,, 2017

Loan to Value

The loan-to-value (LTV) ratio is a financial term used to express the ratio of a loan to the value of an asset. The term, which is commonly used in mortgage lending, is a key indicator in assessing the riskiness of a particular loan. In other words, looking at a borrower’s LTV helps us determine the cost to lend you (the borrower) money. A low LTV means a better rate for you on your property tax loan.


The term is commonly used by banks and building societies to represent the ratio of the first mortgage line as a percentage of the total appraised value of real property.

Notary Public

An individual authorized to certify contracts, deeds, and other documents. The notary, who may also be referred to as the signing agent, is the representative we will send to your home to sign and finalize your loan closing documents


A contiguous area of land described in a single legal description or as one of a number of lots on a plat; separately owned, either publicly or privately; and capable of being separately conveyed.

Travis County Tax Office,, 2017

Promissory Note

A signed document containing a written promise to pay a stated sum to a specified person at a specified date. The promissory note is one of the disclosures included in your loan package that will require signature.

Real Property

Consists of the interests, benefits, and rights inherent in the ownership of land plus anything permanently attached to the land or legally defined as immovable; Also called “realty.”

Travis County Tax Office,, 2017

Taxing Units

Local taxing units, including the school districts, counties, cities, junior colleges and special districts, decide how much money they must spend to provide public services. Property tax rates are set according to taxing unit budgets. Some taxing units have access to other revenue sources, such as a local sales tax. School districts must rely on the local property tax, in addition to state and federal funds

Travis County Tax Office,, 2017

Truth in Lending Disclosure

This document discloses the APR of your loan, total number of payments, and payment amounts.

Your tax office may offer delinquent tax installment plans that may be less costly to you. You can request information about the availability of these plans from the tax office.
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