can a mortage co drop the escrow account without letting you know

dtetzlaff · Joined: 16 Sep 2008 Posts: 2 1.99 Dollars($)

Last Sept 2007 our mortage co drop our payment. My wife ask why and was told that the pmi was being droped because we owned more than 20% of the house. Our payment went down to $375.00 per month. Now this Sept 2008 they say that our payment is going up over $600.0 per every two weeks to make up for they dropping the escrow account and paying the taxes. This is all without us knowing that they even did this. Our we responsable for the shortage and why would they pay out when they didn't even have the money in and account
Shouldn't they have asked us in the first place about dropping the escrow account and I fell that they should be responsable for this entire problem. Can you help ?

lisascherzer · Joined: 04 Jan 2008 Posts: 755 1.03 Dollars($)

It sounds like the mortgage company made a mistake and are now trying to fix it. Unfortunately there is not much you can do. You might want to take a look at refinancing to eliminate the PMI and get a fresh start on the escrow for taxes and insurance. With the recent rate drop, it is possible to get a rate that is in the 5's on a 30 year fixed rate.

gmakerley · Posted: Wed Sep 17, 2008 7:28 am Post subject:

i agree with lisa in that fixing the problem is necessary.

the first question that came up as i read your original post is "do you ever review your statements?" i suspect the answer to that question is "no." had you been vigilant, you would surely have noticed that there was no escrow being collected.

inasmuch as the real estate taxes on your home are your responsibility; you are, indeed, responsible for repayment of the amount your lender paid out.

dtetzlaff · Joined: 16 Sep 2008 Posts: 2 1.99 Dollars($)

Yes I understand that we are responsable for our taxes. I just don't understand how a mortage co would pay for them out of a account which they themselves closed, and told us that it was just the pmi being taken off. Where did the money come from and why would they let this go for a year before telling us that we didn't have a escrow account and now we are supposed to come up with the money right now. we do have a 15 yr
and we did that so we could pay off the home earily. I think what we will do is pay them back the money for the taxes and start a account of our own to put the money up for the coming year taxes, and our home insurance. this way we can make the interest on the money ourselves.
Belive me we will not go through something like this again. This is our first home and we are sure learning a lot ! Like making sure in writing what is going on and not taking someone's word for things this important.

gmakerley · Posted: Wed Sep 17, 2008 11:59 am Post subject:

dtetzlaff, it is good, logical thinking that you use in establishing a new account for the purpose of paying your taxes in the future. check your statements from the lender, however, to ensure that your taxes don't get paid twice next time around - by you and by them (insurance, too).

you actually should have received all the appropriate documentation in writing concerning escrows, etc. perhaps you'd be well-served to contact someone in the customer service area to try to get copies of the closing documents, in the event you don't have them now.

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