Help Getting rid of Escrow Account?

[ColinR]

You said the key word. You built your home in 2015 appraisal district didn't assess a value on the structure until 2016 your escrow payment for all of last year was most likely based off taxes on the land only. Lender should have prepared you for that

I'm in the same boat as this. But I knew my taxes were going to be going up so I kept calling my bank telling them I needed to pay more in escrow but they never would get it taken care of. Each payment I just added more to the escrow amount and did it myself. Then they tried to give it all back. After several calls to them trying to make them understand I gave up and just told them to drop the escrow, send me my money and I'm taking care of it myself. I just did this Monday of this week. To drop my escrow just required a phone call. But I do have over 80% equity in the home so that might have something to do with it.

[rladner]

Mine increased significantly but it was due to the fact I bought my home in 2015. The escrow amount was based off the taxes owed in that year. Well, since the house sold, the property tax for 2016 was based off the new value. My mortgage company was still charging me the old rate (lower). At the end of 2016 they paid all my taxes but I was now negative in my escrow. They told me I needed to come up with the difference and they adjusted my new escrow amount going forward. I knew this was coming because I'm smarter than they are . Anyways, this year I will be paying the back owed escrow amount PLUS the new amount so my payments jumped. After I have paid the back owed escrow my payments will go back down to the correct amount. Again, I'm ok with this since I knew it was going to happen and have money in savings for it, but if I didn't, it would have been a big nasty surprise.

[Randy]

You said the key word. You built your home in 2015 appraisal district didn't assess a value on the structure until 2016 your escrow payment for all of last year was most likely based off taxes on the land only. Lender should have prepared you for that

This has all the symptoms of Wells Fargo bank. I've seen folks lose their houses because Wells Fargo based their property tax off of just the land. Rock along a few years and boom the payment quadruples and the folks have to sell out.

[bowmansdad]

This has all the symptoms of Wells Fargo bank. I've seen folks lose their houses because Wells Fargo based their property tax off of just the land. Rock along a few years and boom the payment quadruples and the folks have to sell out.

This happened to my daughter last year. Luckily, she has called me earlier and told me they weren't taking enough escrow. They saved enough to pay the deficit when the mortgage company finally woke up.

[Austin]

You also have to realize that Wells Fargo buys a lot of loans from other lenders and then they provide the servicing. On a new loan it is up to the lender to set the initial escrow up correctly. I am a mortgage lender and we always look at the tax appraisal and set up escrows based off the amount due before any exemptions. On new construction we base it off the anticipated value (appraised) not raw land. It is much better to set expectations up front

If the increase in taxes from raw land to assessed value causes someone to lose their home or be forced to sell they built to much home qualifying should always be done at market on taxes

[JMB]

You said the key word. You built your home in 2015 appraisal district didn't assess a value on the structure until 2016 your escrow payment for all of last year was most likely based off taxes on the land only. Lender should have prepared you for that

This is exactly what happened. Spoke to Mortgage company and they were only going off taxes from the land. Now after this year the house is in there which is why taxes shot up. luckily I have the money to take care of the shortage. I could see how that could screw someone pretty quick. I was never informed about this and this was the first house I have built. Lesson learned. I appreciate all the feedback. Ya'll have a good weekend!