Mortgage Loans

[JoeEvans]

Hi Folks,

Probably cant do anything on this but thought I would ask :  My esrcow went up a bit this year through BOA and as I understand it..It is because the home insurance they paid out slightly more than projected. Same for property taxes..So what I was told was it left me with a shortage at one point in the year. I can reduce the payment if I pay the difference upfront to them which make zero sense . Last year they tried to add a surplus amount but because at no point was it projected below negative....I told them forget it chnage it back and they did . Since they paid slightly more than projected when it came time to pay the insurance and taxes about 100 bucks each..I assume I can't tell them forget it..not paying the increase...correct?

Appreciate your input and time.!

[bobebob]

My understanding is that they can forecast future payments based off of previous payments (IE the increased amount of your HomeOwners insurance).  And if that forecast drops below $300 POSITIVE, they can require you to send in more money for escrow to raise up the account.

If you don't send in the extra, I'm pretty sure that they would start charging you late fees on the "missed" escrow payment.

My mortgage is with BOA and I like them most of the time.  But I wouldn't expect them to miss a chance to charge you a fee.

Big picture they are just acting as your agent and the increased amount they are asking for is to pay your bills associated with the property.  Not giving them the money to do so is not really an option.

[MovingForward_2012]

Yes I agree. You don't have an option but to pay it. Property taxes and insurance fluctuate over the life of the loan. They do their best to estimate what the costs will be and some of that estimating depends on how you setup your escrow account in the beginning. There were two different escrow options on one of the loan paperwork forms I had to fill out and one required more money upfront at closing but reduced the risk of my escrow account being short. And if it turns out my escrow account had more money in it than needed for that year, I get a refund. It is unfortunate that your escrow account didn't cover everything that year and that you have to pay. Hopefully, it is adjusted so that next year you break even or get a refund check.

[JM-AM]

In the same respect, when you over pay into your escrow payment you will receive a refund at the end of the year.

[JoeEvans]

Hey thanks folks!! Appreciate the feedback...