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View Poll Results: Do you use escrow account?
Yes 22 55.00%
No 18 45.00%
Voters: 40. You may not vote on this poll

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Old 05-07-2009, 05:59 PM
 
Location: Right where I want to be.
4,507 posts, read 8,289,993 times
Reputation: 3341

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Nope, never will again. It wasn't very 'convenient' when they messed up our tax payments 3 years in a row. We had to straighten it all out. We got hit with late fees and penalties due to their errors. There were multiple adjustments, some years up, some years down...although there didn't seem to be any real reason for the adjustment. In general, they didn't seem to know what they were doing. What a PITA!!!
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Old 05-07-2009, 09:54 PM
 
Location: SE Florida
1,194 posts, read 3,813,571 times
Reputation: 754
According to my Mortgage Broker brother an escrow account is an amount that the banks use to further their position. Banks usually charge around 1/4 point for not having an escrow. In our case the 1/4 point is ranging $300.00+ and mortgage brokers can pay that amount if the primary can recommend customers to them. Sort a like saying "Thanks"...

I never used Quicken because I have designed my own MS Excel program for my finances.
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Old 05-07-2009, 10:42 PM
 
Location: Sacramento
2,568 posts, read 6,197,023 times
Reputation: 1924
Quote:
Originally Posted by Synergy1 View Post
Banks usually charge around 1/4 point for not having an escrow.
Some banks do some don't. Ours doesn't.
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Old 05-08-2009, 05:42 AM
 
Location: Right where I want to be.
4,507 posts, read 8,289,993 times
Reputation: 3341
Quote:
Originally Posted by Synergy1 View Post
Banks usually charge around 1/4 point for not having an escrow.
Ours didn't either. Think about it, why would the bank charge you for NOT using the escrow service? Another poster said they are not allowed to earn money from escrow accounts ( I don't know that is the case) but it requires them to manage the account so there is a cost to them. That's not to say they wouldn't make up a charge anyway, but I'm sure it's negotiable...many of those types of fees are. I doubt they'd let you walk out the door rather than waive the $300 fee....if they do, you'd want a different lender anyway.

Quote:
Originally Posted by suzie02
If your LTV is 80% or less you can not be required to escrow.
I don't think that is the case either. For our last house we had more than 20% down and one lender we were looking at still required an escrow. We questioned it several times to make sure we understood because that was not standard. We chose another lender.
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Old 05-08-2009, 06:50 AM
 
45 posts, read 272,192 times
Reputation: 43
I am trying to fight off escrow with my mtg lender. I am putting 20% down and am paying points with great credit yet they want me to escrow.. I hope you can share with me ways to avoid having to escrow, are there any laws or does the lender impose it just cause they can??
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Old 05-08-2009, 07:02 AM
 
Location: Castle Hills
1,133 posts, read 2,409,883 times
Reputation: 611
Its very simple. When you are doing a mortgage loan you tell them flat out that you don't want escrow. If they tell you it will make your rate 1/4 of a point higher.. you tell them you will go with another lender if they cannot waive that. I've done 2 loans in the past and told them both times I didn't want to do escrow. Neither one had a problem and neither one charged a higher rate.

If you are the type that is not responsible enough to save your money and pay at the end of the year, then do the escrow(This is about 90% of people out there who get loans) If you are responsible and would rather have access to your money throughout the year, and don't want the bank screwing up anything, do not do escrow. (This is 10% of people out there) Are you in the 90%(Sheep)? Or are you in the 10%? The bank hopes you are part of the 90%.
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Old 05-08-2009, 07:10 AM
 
45 posts, read 272,192 times
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Thanks ufc.. the problem is although I have bluntly denied escrow, if I back out now and go with another lender I lose my appraisal fee paid and closing date set of may 25 will never happen =(
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Old 05-08-2009, 07:41 AM
 
Location: Right where I want to be.
4,507 posts, read 8,289,993 times
Reputation: 3341
Quote:
Originally Posted by MajesticCALIFORNIAN View Post
Thanks ufc.. the problem is although I have bluntly denied escrow, if I back out now and go with another lender I lose my appraisal fee paid and closing date set of may 25 will never happen =(
What do they say when you say "No, I don't want an escrow account. Take it out."?

You really should have had this cleared up before finalizing your choice for lender.
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Old 05-08-2009, 12:10 PM
 
Location: Florida
6,262 posts, read 17,889,787 times
Reputation: 4723
my daughter doesn't want an escrow acct. but was told she was required to with a USDA loan.

Quote:
Originally Posted by ufcrules1 View Post
Its very simple. When you are doing a mortgage loan you tell them flat out that you don't want escrow. If they tell you it will make your rate 1/4 of a point higher.. you tell them you will go with another lender if they cannot waive that. I've done 2 loans in the past and told them both times I didn't want to do escrow. Neither one had a problem and neither one charged a higher rate.

If you are the type that is not responsible enough to save your money and pay at the end of the year, then do the escrow(This is about 90% of people out there who get loans) If you are responsible and would rather have access to your money throughout the year, and don't want the bank screwing up anything, do not do escrow. (This is 10% of people out there) Are you in the 90%(Sheep)? Or are you in the 10%? The bank hopes you are part of the 90%.
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Old 05-08-2009, 03:16 PM
 
587 posts, read 2,015,477 times
Reputation: 224
Quote:
Originally Posted by MajesticCALIFORNIAN View Post
I am trying to fight off escrow with my mtg lender. I am putting 20% down and am paying points with great credit yet they want me to escrow.. I hope you can share with me ways to avoid having to escrow, are there any laws or does the lender impose it just cause they can??
If the loan officer/broker won’t do it for free now you can call the bank once the mortgage is established and see if they will remove it. The good thing about that is if the bank accepts removal of escrow it will be no cost to you. Sometimes the bank will require you to keep it for six month or one year to gauge your payment worthiness. This will not work if you are paying PMI so you must have at least 20% equity, so in your case it may work depending on the bank.
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