Posted on: 28th Jun, 2008 04:28 am
I'm refinancing and considering excluding escrow from my monthly payment. In these hard times no one's job is secure. My thinking is a lower mortgage payment is easier to meet without the escrow hopefully buying time and putting off foreclosure if I do lose my job.
Is this a wise choice?
Is this a wise choice?
welcome cucino.
You can avoid escrow if you can make a big down payment at least 20 percent of the LTV. If you you don't have any escrow account then you will have pay the tax bill and the insurance payments on time on your own. So can you be able to do it?
You can avoid escrow if you can make a big down payment at least 20 percent of the LTV. If you you don't have any escrow account then you will have pay the tax bill and the insurance payments on time on your own. So can you be able to do it?
excluding escrow from my monthly payment"makes me think you are talking about the impound account included to pay your property taxes & hazard insurance...correct?"
Not having these amounts included in your payments means you will be responsible and should the time come that you are unable to pay these on your own 2 things will happen:
1) your lender will insure your property and charge you the amount of the insurance policy (and generally speaking the policy the lender buys is much more expensive than the one you choose),
2) unpaid property taxes can result in a lien being placed on your property & the title will no longer be clear in the event you decide to sell the property which can often be the only decision to solve the problem in a foreclosure.
I would feel it is safer to have the amounts included with the payment unless it absolutely makes the payment way too high.
Not having these amounts included in your payments means you will be responsible and should the time come that you are unable to pay these on your own 2 things will happen:
1) your lender will insure your property and charge you the amount of the insurance policy (and generally speaking the policy the lender buys is much more expensive than the one you choose),
2) unpaid property taxes can result in a lien being placed on your property & the title will no longer be clear in the event you decide to sell the property which can often be the only decision to solve the problem in a foreclosure.
I would feel it is safer to have the amounts included with the payment unless it absolutely makes the payment way too high.
Depending on the loan to value many lenders will require escrows.
It either has to be paid monthly or three big payments through out the year. (2 tax 1 insurance) is it really easier to come up with the big payment? If you dont pay them the lender will force a policy on you and it wont be cheap...
I personally prefer impounds
Good Luck
Brian
It either has to be paid monthly or three big payments through out the year. (2 tax 1 insurance) is it really easier to come up with the big payment? If you dont pay them the lender will force a policy on you and it wont be cheap...
I personally prefer impounds
Good Luck
Brian
Can a morgage company forse you to escrow on morgage payment
Hi Joe!
Welcome to forums!
It will depend on the policies of the lender. You can ask the mortgage lender if it is mandatory for you under his company's rule to open an escrow account. Opening an escrow account will also depend upon the the closing documents. However, it is always a good idea to open an escrow account as you can get various facilities from it.
Feel free to ask if you have further queries.
Sussane
Welcome to forums!
It will depend on the policies of the lender. You can ask the mortgage lender if it is mandatory for you under his company's rule to open an escrow account. Opening an escrow account will also depend upon the the closing documents. However, it is always a good idea to open an escrow account as you can get various facilities from it.
Feel free to ask if you have further queries.
Sussane