What is the state intangible tax on mortgages?

The state intangible tax on mortgages must be paid before a new mortgage can be recorded in the public records.

It is an amount paid to the local clerk of the court at the rate of 2 mills ($0.002) on the total amount of any NEW mortgages

A NEW mortgage is a mortgage that is created at the closing table as opposed to a mortgage that is assumed

Seller financing is always a new mortgage because it is created at the closing which will cause a vendor’s lien to be created

This is a one-off tax and is not paid every year

The buyer normally pays this tax at closing

On the closing statement it is normally shown as a debit to the buyer