Do all lenders require escrow now?

[Lemmus]

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@Anonymous wrote:

thanks. but am bit confused.

so if i am closing on May 1st 2015.Must i have tax for the rest of 2015  or two months later .I am confused.

my builder is going to pay 5000 towards closing .FHA. How much extra do i typically need to chip in?

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...if you have the right mortgage lender, they will take you through the full pre-approval process, not just pre-qualification ...they will provide you with a detailed disclosure statement which requires your signature and tells you to the penny exactly what your full monetary needs will be at closing, including amounts you may pay during the process and be credited for at closure ...and they will do so with or without a home under contract.

...I've got pre-quals from 4 different lenders ...only one did the full approval, UW, disclosure process and I have yet to make an offer on a home ...but my mortgage will go through them because they did the homework (and have always responded to every query) ...I know exactly how much I can buy as well as how much it will cost me out of pocket if I use the full amount (within reason considering that estimates must be used for some costs) ...as well as a 2nd breakdown for the amount I intend to buy at which is 70% of what I qualified for.

...I would assume that many mortgage lenders will scoff at such service ...they are not on my list for obvious reasons ...mortgage lending is a very competitive business ...don't hesitate to try another if you're not happy with the answers/service you are getting from your current lender ...it did cost me time, research, money, and inquiries to go through lenders until I found one that I'm happy with ...but imnsho it was well worth it.

...and no. obviously a "tbd" disclosure isn't the final word ...but imnsho, it is sound evidence of what I can expect both in my final closing costs and in the future level of service from the mortgage lender who provided it.

[StartingOver10]

OP, you have to check your contract to see if the $5k is going to your closing costs - or if it is going toward closing costs that the builder pushes over to the buyers side.

I have seen the result when the buyer assumes the closing cost contribution go to cover their costs and the reality is the builder (and this usually only happens with builders) is paying for what s/he would normally pay but they have moved "standard" builder/seller costs over to the buyers side.

As pointed out in the post above, you can only compare by looking at the Good Faith Estimate from your lender. Some lenders will give you a closing cost worksheet that gives you all the figures before you make application so you know exactly where you stand from Day 1. Like the pp, I prefer to work with those lenders because there are no surprises.

[mynameainttracy]

Well I definitely need to contact my LO and find out why we are paying so much. On our GFE, two boxes are checked in the prepaids section for "all insurance" and "all property taxes" and is for over $5000. That's a years worth, not 2 months. Ouch.

Edit - My LO explained everything to me. We have to pay a year in advance here to the tax collector.

[StartingOver10]

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@mynameainttracy wrote:

Well I definitely need to contact my LO and find out why we are paying so much. On our GFE, two boxes are checked in the prepaids section for "all insurance" and "all property taxes" and is for over $5000. That's a years worth, not 2 months. Ouch.

Edit - My LO explained everything to me. We have to pay a year in advance here to the tax collector.

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Wow! Where are you? 

Our tax collector collects in arrears on a calendar basis. In other words Jan to Dec is billed on Nov 1st each year.  The taxes aren't even determined until Sept and a bill is sent out Oct 31st.  I never heard of collecting taxes in advance.

[mynameainttracy]

We are in PA. This is our first time buying here. Our previous homes were in NC and they did taxes like you described. 

[USF813]

Personally I love escrow. It takes the guessing game out of taxes for me.

[ShanetheMortgageMan]

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@Revelate wrote:

Is there any pros / cons for waiving escrow if you're putting 20+% down?  Besides not coughing up additional cash early or assuming you can do better managing the payments than the escrow company which is possibly a suspect assertion.

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In most states (but not in CA) there is a .250 price increase to the rate if you waive escrows.

Just to set the record straight... VA, FHA & USDA will always require an escrow account.  Conventional doesn't require an escrow account if the LTV is 80% or less (in CA it's 90% or less).