| Posted By |
Message |
ohbaby08
Winter is Coming
Member since 10/07 1718 total posts
Name:
|
Getting rid of escrow account
We've always had our taxes/homeowner's insurance paid from our escrow account, but I hate how much we pay per month for it versus what our actual mortgage payment is.
Has anyone removed their escrow account and started paying the taxes and things yourself?
We would be able to save so much more money per month, but I just worry about having the right amount when it comes time to pay.
|
Posted 12/2/16 11:34 AM  |
| |
|
Long Island Weddings
Long Island's Largest Bridal Resource | Prudential Douglas Elliman Real Estate |
MrsT809
LIF Adult
Member since 9/09 12167 total posts
Name:
|
Getting rid of escrow account
Weer just refinance and our bank no longer escrow homeowners insurance. Not sure on taxes but I would just call the bank and see if they require taxes to be escrowed. You're paying the same either way aside from the little bit of interest you can earn on that money.
|
| Posted 12/2/16 1:09 PM |
| |
|
NYCGirl80
I love my kiddies!
Member since 5/11 10413 total posts
Name:
|
Re: Getting rid of escrow account
Our bank requires it, so it's not an option.
|
| Posted 12/2/16 1:26 PM |
| |
|
muffaboo
LIF Adult
Member since 12/10 3797 total posts
Name:
|
Re: Getting rid of escrow account
We've never had an escrow account (we paid cash) so we always pay our own homeowners and property taxes. We get a discount for paying insurance in one sum vs. monthly so we always do that (our premium is always due in September) then we pay our taxes twice a year when they are due in May and January.
I'd rather do it that way but I know many people prefer to pay monthly so they know they have the money and don't have to come up with such a large sum at once. If you think it might be hard to come up with the total amount in one shot, you could put away the amount you need each month into a separate savings or checking account so you know it will be there when the due dates roll around. That may not be much different from escrow but if you want to get rid of the escrow account, you can at least gain a little bit of interest on that money.
|
| Posted 12/2/16 6:39 PM |
| |
|
BabyBoy
is Skylar Elizabeth
Member since 5/05 4189 total posts
Name:
Tom
|
Getting rid of escrow account
Your amount wont change. Insurance is insurance as it is with taxes.
My bank makes 1 year insurance payment and 2 bi annual tax payments.
|
| Posted 12/3/16 3:28 PM |
| |
|
MrsO
Big Brothers to Be
Member since 1/07 4521 total posts
Name:
Maureen
|
Re: Getting rid of escrow account
We stopped escrowing because the bank required to keep so much up front. So each month I put away 1/12 of what the taxes and insurance are. This way I have no issues to pay the taxes and insurance and the bank isn't making money off my few extra thousand dollars they wanted to hold
|
| Posted 12/5/16 10:58 AM |
| |
|
ohbaby08
Winter is Coming
Member since 10/07 1718 total posts
Name:
|
Re: Getting rid of escrow account
Posted by BabyBoy
Your amount wont change. Insurance is insurance as it is with taxes.
My bank makes 1 year insurance payment and 2 bi annual tax payments.
The amount that we pay per month to the bank would go down.
|
| Posted 12/5/16 1:54 PM |
| |
|
jamnmore
LIF Adult
Member since 6/16 989 total posts
Name:
|
Re: Getting rid of escrow account
Posted by ohbaby08
Posted by BabyBoy
Your amount wont change. Insurance is insurance as it is with taxes.
My bank makes 1 year insurance payment and 2 bi annual tax payments.
The amount that we pay per month to the bank would go down.
I think what was meant is that you still need to pay the same amount. Most people budget for that expense monthly. Difference with having an escrow is that you mail it to the bank to hold it for you VS sending it to your own bank account to not use. Really your mortgage payment is not changing.
You need to have that money when the taxes and homeowners comes due. We are contemplating removing our escrow but know we need strict discipline to have the money when it is needed.
|
| Posted 12/5/16 3:30 PM |
| |
|
chilltocam
LIF Adult
Member since 11/11 9141 total posts
Name:
|
Re: Getting rid of escrow account
Posted by ohbaby08
We would be able to save so much more money per month, but I just worry about having the right amount when it comes time to pay.
If you're worried about this, I would not do it. If you can't save 1/12 of your tax payment every month to make sure you will have it when it comes due, then it's a REALLY bad idea to "save" on each monthly payment but not have what you need come tax time. In the long run, you are not saving anything. The worry of not having the tax payment when it's due because you didn't save each month is not worth anything you might gain by not having your taxes escrowed. If you are not 100% sure you could save that amount over the course of the year, DON'T DO IT.
Message edited 12/5/2016 4:02:56 PM.
|
| Posted 12/5/16 3:59 PM |
| |
|
ali120206
2 Boys
Member since 7/06 17792 total posts
Name:
|
Getting rid of escrow account
We have never escrowed - the amount they wanted up front when we first closed was ridiculous, on top of the amount we would be paying monthly...
Each payday, I have money taken out of my checking account and moved to a separate savings account to cover the taxes and insurance.
Message edited 12/6/2016 8:36:03 AM.
|
| Posted 12/6/16 8:35 AM |
| |
|
ali120206
2 Boys
Member since 7/06 17792 total posts
Name:
|
Re: Getting rid of escrow account
Posted by BabyBoy
Your amount wont change. Insurance is insurance as it is with taxes.
My bank makes 1 year insurance payment and 2 bi annual tax payments.
It may change - in many cases, the bank takes more money than you actually have to pay so they are able to cover the taxes.
|
| Posted 12/6/16 8:36 AM |
| |
|
|
|
Re: Getting rid of escrow account
Posted by ali120206
Posted by BabyBoy
Your amount wont change. Insurance is insurance as it is with taxes.
My bank makes 1 year insurance payment and 2 bi annual tax payments.
It may change - in many cases, the bank takes more money than you actually have to pay so they are able to cover the taxes.
My bank does this too- though they have refunded money from us. And I successfully grieved my assessment this year and finally got a fat check from that which was nice.
To the OP, I can't answer your question because not using escrow is not an option for us either. But good luck.
|
| Posted 12/6/16 9:12 AM |
| |
|
ohbaby08
Winter is Coming
Member since 10/07 1718 total posts
Name:
|
Re: Getting rid of escrow account
Posted by jamnmore
Posted by ohbaby08
Posted by BabyBoy
Your amount wont change. Insurance is insurance as it is with taxes.
My bank makes 1 year insurance payment and 2 bi annual tax payments.
The amount that we pay per month to the bank would go down.
I think what was meant is that you still need to pay the same amount. Most people budget for that expense monthly. Difference with having an escrow is that you mail it to the bank to hold it for you VS sending it to your own bank account to not use. Really your mortgage payment is not changing.
You need to have that money when the taxes and homeowners comes due. We are contemplating removing our escrow but know we need strict discipline to have the money when it is needed.
Obviously, I understand that. But, by paying the exact amount directly to the town, it avoids the extra money that the bank always seems to keep in escrow.
|
| Posted 12/6/16 9:41 AM |
| |
|
ohbaby08
Winter is Coming
Member since 10/07 1718 total posts
Name:
|
Re: Getting rid of escrow account
Posted by chilltocam
Posted by ohbaby08
We would be able to save so much more money per month, but I just worry about having the right amount when it comes time to pay.
If you're worried about this, I would not do it. If you can't save 1/12 of your tax payment every month to make sure you will have it when it comes due, then it's a REALLY bad idea to "save" on each monthly payment but not have what you need come tax time. In the long run, you are not saving anything. The worry of not having the tax payment when it's due because you didn't save each month is not worth anything you might gain by not having your taxes escrowed. If you are not 100% sure you could save that amount over the course of the year, DON'T DO IT.
We've never done it, so it's not so much that we won't have it. I guess it is more like an additional responsibility than being worried about not having the money. We would definitely put the money needed aside every month.
|
| Posted 12/6/16 9:43 AM |
| |
|
Millie3
LIF Adult
Member since 7/13 1280 total posts
Name:
|
Re: Getting rid of escrow account
Posted by ali120206
We have never escrowed - the amount they wanted up front when we first closed was ridiculous, on top of the amount we would be paying monthly...
.
Same here. Bank wanted 6 months of taxes and a year for the insurance. Basically over 6 k just to hold on to. We decided not to escrow
|
| Posted 12/6/16 7:23 PM |
| |
|
