Escrowed tax bill

[ponder]

I just received a letter from my county tax assessors office that my tax bill has not been paid. My taxes are escrowed through my mortgage company (BBVA Compass) and apparently they have not paid my taxes on time, so far incurring me a $100 late payment fee. I am calling tomorrow to see why they have not paid the bill. I am so mad right now I could spit nails. Do I have any recourse? Refinancing through someone else seems really appealing right now (without escrow of course).

 

[sonnyjane]

UGH! Stuff like that makes me FURIOUS too!

I'd say that you'd have to carefully consider the re-fi, however tempting it sounds, because I think you'd have to pay closing costs which could be much more than the $100 late fee you're dealing with haha. I'd definitely ask the bank to take care of the late fee though!

 

[amc80]

My mortgage company screwed up and didn't pay my escrowed property taxes. I called them and they paid the late fee without hassle.

 

[ponder]

Thanks amc80 & sonnyjane. I was so mad I couldn't even subtract right. Dh looked at it and it's a $200 fine.

It is good to know that I may not get too much of a hassle with my mortgage company. I am serious about the refi though. It is not a knee jerk reaction, DH and I have been discussing it, especially since we found out last week that our value has gone up by 50% since we bought it 3 years ago. We could switch to a 15 year and drop the escrow.

Luckily i have an appointment with our accountant and financial planner tomorrow morning and i think a refi needs to be discussed.

 

[movie zombie]

is there a reason you have your taxes bundled in with your payment?
perhaps after you call and advise your loan holder of their error and that they will be paying the late fine of $200 you can inquire as to how to take over tax payment for yourself.
also, try and speak to a supervisor/manager.

one problem could be that your loan was sold?
also, when/if you refi try and avoid PMI....and assume tax bill payment yourself.

not all loan holders do their own loan servicing. they may have outsourced this to another group.

I used to work at a large nationally S&L back when the savings and loan crisis "happened" in the 1980's and it was a real education.

 

[Andelain]

I'd be ill with them too, and fully expect them to pay the late fee. Don't take No for an answer.

 

[Dee*Jay]

The bank is absolutely obligated to pay that fee. Regarding escrowing, unless your mortgage is less than 80% (and sometimes 75%) of your property value you are obligated to escrow for taxes with every lender I've ever heard of (and I've been a real estate agent for 10 years now). Good luck getting this easily worked out!

 

[OUpearlgirl]

In my experience working with mortgagees (on the insurance side) they will pay late fees if they missed the payment. I would call and have them sort it out immediately.

 

[ponder]

When we purchased this home 3 years ago we had to begin escrowing again ( did not with our first house) because we put 0% down. Due to DH's specific occupation (very low risk on default) we could obtain a 0% down payment, no PMI loan and still take advantage of the insanely low interest rates, but because we did not have 20% down/equity we were required to escrow.

Good news is that while DH was digging out the mortgage companies' phone number this morning, I logged into the county tax website and magically our bill was paid in full with no fees/penalties (it was delinquent with last night). I now wonder if it was a tax assessors error or the mortgage company. The bill was due on the 31st, but not credited until the 4th, but with no fees/penalties. Still thinking about a refi and switching to a 15 year mortgage.

 

[qtiekiki]

The bank is absolutely obligated to pay that fee. Regarding escrowing, unless your mortgage is less than 80% (and sometimes 75%) of your property value you are obligated to escrow for taxes with every lender I've ever heard of (and I've been a real estate agent for 10 years now). Good luck getting this easily worked out!

I don't think the mortgage has to be that low compared to the property value. Our property tax and insurance are not escrowed into the mortgage, and our mortgage is definitely not less than 75% of the value.

 

[Dee*Jay]

The bank is absolutely obligated to pay that fee. Regarding escrowing, unless your mortgage is less than 80% (and sometimes 75%) of your property value you are obligated to escrow for taxes with every lender I've ever heard of (and I've been a real estate agent for 10 years now). Good luck getting this easily worked out!

I don't think the mortgage has to be that low compared to the property value. Our property tax and insurance are not escrowed into the mortgage, and our mortgage is definitely not less than 75% of the value.

Interesting! All of the lenders I or my clients have done business with in Chicago require escrow if the mortgage *at the time of purchase* is more than 80%(ish) of the purchase price. Perhaps this convention is not followed in other geographies (?).

 

[ame]

As I understand here, you're lumped in for taxes and homeowners insurance til the house is completely paid off, then you pay taxes and homeowners on your own.

 

[amc80]

The bank is absolutely obligated to pay that fee. Regarding escrowing, unless your mortgage is less than 80% (and sometimes 75%) of your property value you are obligated to escrow for taxes with every lender I've ever heard of (and I've been a real estate agent for 10 years now). Good luck getting this easily worked out!

I don't think the mortgage has to be that low compared to the property value. Our property tax and insurance are not escrowed into the mortgage, and our mortgage is definitely not less than 75% of the value.

Interesting! All of the lenders I or my clients have done business with in Chicago require escrow if the mortgage *at the time of purchase* is more than 80%(ish) of the purchase price. Perhaps this convention is not followed in other geographies (?).

That's how it is here. Property values have gone way up since I purchased and I tried to drop the PMI, but no luck. Even if my property value doubled they still require it because the mortgage was more than 80% of the value at the time of purchase.

 

[Sparklelu]

We did a refi this spring. We had to escrow because the LTV was literally at 80%, but we were told that after 5 years, provide the LTV is at 79% ( which it will be) we can stop the escrow and pay on our own. The plan is to do that, but continue to pay the same amt cutting down on the length dope the loan. Plus we are making two payments a month to cut a few years off the loan.
We are also planning on making a once a year extra payment of $3-4,000. At the end of each year DH gets a lump sum payment from a retirement COLA, this year we got new couches, new fridge and new garage door, plus paid cash for all Christmas.
Next year the mortgage gets a bonus payment.

 

[texaskj]

When I got the mortgage on my house, the banker told me I didn't have to have an escrow account because my FICO rating was over 800. She never even asked about the down payment.

 

[ponder]

Wow, I'm shocked... I just got an apology letter from my bank for almost paying my taxes late. Didn't see that one coming.

 

[luv2sparkle]

That is surprising Ponder. Maybe now since your loan to value is better, you can drop the escrow account. We haven't had one in years and it is the best thing. I like paying the taxes and the insurance myself. It always used to bug me that our bank held a few hundred dollars a year more than we need to pay what was needed and we had to petition to get it back.

 

[ChristineRose]

My first loan required me to escrow, and they messed it up spectacularly. More about that later.

My second loan told me they would not escrow. I was ecstatic.

My third loan was with the same vendor as loan #2 and this time they told me they were requiring all loans to escrow. Go figure.

My first loan company did not pay my taxes and I got a letter from the city. I called the city and they told me that taxes had been paid with my name and somebody else's property number. On the day taxes were due, the city got a payment of six million dollars (covering many people) and they sent the problem payments back the next day.

The mortgage company told me that my monthly payments would need to increase to cover my property taxes, which were much higher than expected. (Duh.) I told them that no, I wasn't going to do that. I explained it and they told me it would be taken care of. The guy kept telling me my taxes were twice what they had escrowed. He didn't seem to get that (1) Those were not my taxes and (2) they had all the money back anyhow. He finally agreed to let me keep paying last years rates until it was straightened out.

I waited a week or so, and called the city. Still no property taxes. I called the bank again. They told me that they had a 45 day processing time. They made it sound like a quality control thing. They promise to straighten it all out in 45 days. It had to be investigated, even though all the info they needed was public and available from the city with a phone call. (Pre-internet.) They also told me it was the city's fault for not sending the money back (which had happened on the day after taxes were due, remember).

I waited patiently, and got some more letters from the city, now on bright yellow paper.

On day 45, they paid the other person's taxes again.