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Mortgage escrow account question

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amersafe
Valued Member

Mortgage escrow account question

Hello to all....here is the deal I closed on my house October 1, 2013 fha fix rate my first payment was due December 1 which I was so happy to pay then I get a letter from the mortgage company saying that starting February 1, 2014 my monthly payment will go up almost 400.00 dollars or I can pay them 4,500 dollars because they had paid the property taxes and homeowners insurance in total now I am lost! How can this be seems to me I should only owe taxes for oct.-dec. And as I make my monthly payments once November  '14 comes around and they pay these fees the money will be in my escrow account. Please some help me make sense of this issue!

Thanks in advance 

Message 1 of 4
3 REPLIES 3
themizlyne
Regular Contributor

Re: Mortgage escrow account question

Those should have been itemized prepaids on your HUD1. My GFE has 6 months property taxes and 14 months of homeowners insurance.
Message 2 of 4
StartingOver10
Moderator Emerita

Re: Mortgage escrow account question


@amersafe wrote:

Hello to all....here is the deal I closed on my house October 1, 2013 fha fix rate my first payment was due December 1 which I was so happy to pay then I get a letter from the mortgage company saying that starting February 1, 2014 my monthly payment will go up almost 400.00 dollars or I can pay them 4,500 dollars because they had paid the property taxes and homeowners insurance in total now I am lost! How can this be seems to me I should only owe taxes for oct.-dec. And as I make my monthly payments once November  '14 comes around and they pay these fees the money will be in my escrow account. Please some help me make sense of this issue!

Thanks in advance 


Your letter with the escrow analysis that you just received should show exactly what was spent on your behalf for real estate taxes and insurance. As pointed out, get your HUD1 out to compare what was escrowed plus there was a letter in your mortgage package detailing what your escrows would be for the next year.

 

I certainly get that taxes were due and paid in full for the year. That is perfectly normal. There should have been enough collected from the seller and yourself to pay out of your escrow account without adjusting your payment further unless the lender severely underestimated the actual taxes for your property.

 

However, the insurance bill is typically paid one year in advance and that amount is calculated as of the closing date. There should have been no disbursement at all for hazard insurance out of your escrow account. If in fact another year was paid in advance, check with your insurance company and with your lender because the insurance premium is only due one time per year around your anniversary of purchase (which for you is next Oct). Typically the insurance premium is paid about 60 days in advance of the policy end date - not 10 months in advance. Sounds like an error.

 

If you have PMI that is withdrawn monthly from your escrow account.

 

if you purchased a new house and the taxes were not fully realized until this year, then it is possible that there was a large under payment into your escrow account and you can go back to your builder to re-prorate the amount that is due from the builder for the taxes during the time the builder owned the property. Check your pro-ration agreement in the closing package. Some builders won't re-prorate after closing. It will be in writing, as a separate document, in your closing package.

 

If there is an error, get in touch with your servicer right away.

 

Message 3 of 4
DallasLoanGuy
Super Contributor

Re: Mortgage escrow account question

was your loan officer good? thay can look over everything with you.

 

as starting over stated, it could be a couple of things

 

Retired Lender
Message 4 of 4
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