Taxes in Escrow- Closing Ques

Need a little clarification. The closing costs associated with your taxes in escrow~

How do you calculate it? Is it 1 mo, 6 mos, 12 mos?

Lets say you pay 6 mos taxes at closing, does that mean you dont have that in your mortgage payment for the 1st 6 mos?
If you still do, where does it go?

I dont think Im getting it.

Re: Taxes in Escrow- Closing Ques

You pay ahead. You pay 6 month of real estate taxes at closing so you will always be six months ahead.... theoretically.

But once you start making payments to your mortgage... you continue to pay your re taxes as part of your mortgage payment.


When you sell the house... any extra money you have "saved" in your tax escrow goes back to you.

Re: Taxes in Escrow- Closing Ques

Bummer.

So if my taxes go up will escrowed funds cover it so my mortgage payments remain the same?

Also, is it based on true taxes or w/STAR?

TIA

Re: Taxes in Escrow- Closing Ques

The bank *should* adjust your monthly payment based on taxes increasing or decreasing. But you should probably call your bank and ask them their policy on this.

Re: Taxes in Escrow- Closing Ques

Thanks, every bank/broker I ask gives a super vague answer.

Your the best.