Mortgage question...

[Ja Rhule]

I got an escrow. Can the bank increase my mortgage payment for no apparent reason? Just because they anticipate something? Also, we overpaid on our property tax, will the bank give us refund or that money will be held until house is paid off?

[logic1977]

I would think if you are running a balance in your escrow they would have to send you a refund. Early on in a mortgage the lenders tend to be conservative so it isn't a surprise they increased yours for now

[Ja Rhule]

I overpaid my property tax by about $500 and I got no refund but now they want additional $50 a month just in case... What kind of bullshit is that? That's me overpaying by $1.1k a year... That's around $33k over 30 years I will give to bank to hold interest free...

[Lloyd Christmas]

I got an escrow. Can the bank increase my mortgage payment for no apparent reason? Just because they anticipate something? Also, we overpaid on our property tax, will the bank give us refund or that money will be held until house is paid off?

Your bank can not increase your mortgage payment unless you have some type of adjustable rate (like the ARM that got a lot of people into trouble during the housing crises). Other than that, unless you have a a homeowners insurance increase, or a property tax increase,  which I would consider highly suspicious (due to the fact that houses have been losing value over the last few years), there is no reason your monthly payment should increase. 

As far as property tax over payment is concerned, my county requires that you first pay the tax, then file a protest through the tax department. A recent appraisal will aide immensely in your dispute. In my case, the tax value was 20k more than the appraisal, which made a huge difference in my REAL property tax.  In short, almost no one's house is worth what it was 5 years ago, hence, the housing crises. Good luck and have patience. Dealing with those basTURDS can really piss you off.

[Ja Rhule]

They stated that they forgot to add my insurance into escrow but when I pull out my contract, insurance is included into my mortgage payment. I got a conventional loan so no ARM for me.

[KSpan]

Banks are allowed to charge estimated taxes and insurance plus an additional percentage for escrow each year, though I don't remember the percentage off the top of my head. Do a quick Google search and look up the exact percentage to check their calculations, and if they're overcharging they absolutely owe you your money back. I caught B of A doing that BS 2 years ago and got $500 back as well as a drop in my monthly escrow.

To Lloyd - escrow is not considered part of the actual mortgage bill itself, so it can move and will affect the total balance due each month even though the actual principal and interest pmt. Is not changing. Agree completely that a re-appraisal can go a long way toward saving escrow costs.

[Ja Rhule]

It's a brand new home... It appraised for 13% less that what I pay in tax.

[Ja Rhule]

Just read my contract agreement and my bank elected an escrow cushion of $600. They did not used any of the cushion last year and now they want additional $600 for next year. Can they do that?

[NanuqoftheNorth]

Just read my contract agreement and my bank elected an escrow cushion of $600. They did not used any of the cushion last year and now they want additional $600 for next year. Can they do that?

 

Weird, I get a check back for any remainder not spent on taxes and insurance each year from Wells Fargo.

[Ja Rhule]

Weird, I get a check back for any remainder not spent on taxes and insurance each year from Wells Fargo.

My wife is going to talk to em to see what's going on.

[Doyle]

Mine goes up and down all the time.  Sometimes I get a check back at the end of the year but usually they just make a small adjustment to my payment.  Yes its common.

[Big A]

Just read my contract agreement and my bank elected an escrow cushion of $600. They did not used any of the cushion last year and now they want additional $600 for next year. Can they do that?

First off, the option to escrow is usually that, an option. It's done for the convenience of spreading you tax and insurance payments over 12 payments. By law, the bank will give you a separate accounting of all monies in escrow account and because taxes and insurances change from time to time, then would your total monthly payment.

So in short, yes your monthly payment can change because escrow portion can change with an increase in taxes or insurance. If you feel there are setting aside too much money in escrow, you can request an accounting of charges. This is done automatically on same day every year, so if your escrow amount changes, it will do so when they do their annual evaluation. If you are unhappy with how much they are taking out for escrow, you can opt out (usually unless your mortgage requires it) and pay your own tax and insurance bills when due and save up yourself.

Another point you mentioned was your property appraised for 13% less than tax assessment. If you contact your local assessors office, you may be able to get you property tax liability lowered. When you call, they should be able to give you the instructions on the process which is usually filling a form and sending in appraisal and sold comps. from neighborhood.

[Lloyd Christmas]

First off, the option to escrow is usually that, an option. It's done for the convenience of spreading you tax and insurance payments over 12 payments. By law, the bank will give you a separate accounting of all monies in escrow account and because taxes and insurances change from time to time, then would your total monthly payment.

So in short, yes your monthly payment can change because escrow portion can change with an increase in taxes or insurance. If you feel there are setting aside too much money in escrow, you can request an accounting of charges. This is done automatically on same day every year, so if your escrow amount changes, it will do so when they do their annual evaluation. If you are unhappy with how much they are taking out for escrow, you can opt out (usually unless your mortgage requires it) and pay your own tax and insurance bills when due and save up yourself.

Another point you mentioned was your property appraised for 13% less than tax assessment. If you contact your local assessors office, you may be able to get you property tax liability lowered. When you call, they should be able to give you the instructions on the process which is usually filling a form and sending in appraisal and sold comps. from neighborhood.

This is why I opt for them NOT to escrow my account. I don't need any bank to manage my finances for me. They already have their dirty little hands on enough of my money  :cigar: . 

Everything Dat Alice said was spot on.

[Anybodyhome]

We recently sold a house we owned for more than 13 years and received a check a couple weeks after closing for nearly $2k that was in an escrow account for the same reason- fluctuating property taxes and homeowner insurance.

 

The mortgage on our new house will also include insurance and taxes and I think we may opt to receive any positive escrow amounts on an annual basis this time.