Additional mortgage payment to principle or escrow?
Your escrow account is for taxes and insurance only. When you pay extra to principal you are actually paying down the amount you owe - dollar for dollar. So, definitely, pay principal. It's smart too - usually. Good luck.
Can a bank deny you from paying additional principle on a home loan?
If your loan contains some sort of 'pre-payment penalty', you may not be able to do what you do until the prepayment period has passed. Check your loan documents for any such penalty language. If you are past any such prepayment penalty period, you will need to work with an account supervisor to have BoA correct this situation. The following is directly from the Bank of America website: "When you make your regular monthly mortgage payment, you may include an additional amount to be applied directly to principal. If paying by check, to ensure the money is credited correctly, write the amount of the extra principal payment where designated on your Mortgage Account Statement. If you’re an Online Banking customer using Bill Pay, use the Memo line to indicate you are including an additional payment toward the principal. Enter the amount of the extra principal payment and click Send Memo with Payment. Additional principal payments will only be applied after the current month's full payment has posted to your account. Please note: if there is a prepayment penalty associated with your loan, you may be penalized for paying off your loan early. Review the terms of your mortgage to determine if this provision applies to you."
Mortgage/can escrow overage be applied toward the principal?
First of all, what does your mortgage papers say about the mortgage -- can you go talk to the mortgage holder and see what they can do about the escrow refund? In some cases, they MAY be willing to redirect the escrow refund to additional principal pay-down ... but you WILL have to initiate the conversation. YOU need to refinance the mortgage to eliminate this problem -- and you should do that soon. That is the only way you are going to get the ex's name off the escrow refund check. Next ... have you taken your ex-spouse's name off the DEED too? That is another problem that you need to look at shortly -- because (and god forbid this happening -- it was my own worry after divorce) -- if the home is fully designated your property after the divorce -- then you need to NOT only Refinance the Mortgage, but to also first get the Home's Deed also redone to ONLY be in your name ... After all, do you want your ex to PROFIT more AFTER the Divorce IF something should happen and you die?
What happens after my escrow balance is paid off?
Hi guys, Im 27 and bought my very 1st home last month and i was looking at my Mortgage info online and i have a question for you guys. So i know that in the payment, some goes to the principal balance of the loan and there is a small amount that goes to the escrow. So here goes my question; after my escrow balance is paid off in full, will my monthly payment go down? i have an escrow balance of like a thousand and some change and 300$ goes to this so im just wondering that if after that balance is paid in full, if my payment will go down a bit?? thanks for all your answers and sorry im not the best knowledgeable person out there. Its my first home so i dont know the ropes yet :(
What is escrow?
Escrow The holding of a document recording an obligation or transaction by a third party (the escrow agent) with the provision that it is only to take effect as a deed when certain conditions have been met. One condition is often delivery of a similar document executed by another party to the contract it records. Escrow \Es"crow\, n. [OF. escroe, escroue, a roll of writings, bond. See Scroll.] (Law) A deed, bond, or other written engagement, delivered to a third person, to be held by him till some act is done or some condition is performed, and then to be by him delivered to the grantee. --Blackstone. Source: Webster's Revised Unabridged Dictionary (1913) Escrow Account What is it? An account in which a portion of the monthly payment is held by the lender on the borrowers behalf for the payment of future taxes, mortgage and hazard insurance, special assessments insurance, and other on-going payments as they occur. Also called an Im
I'm selling my house and escrow closes in 20 days. My mortgage pmt is due in 12. How can I delay that payment, since the mortgage will be gone soon?
Though this sounds good on the surface, the problem is understanding how amortization works. Mortgage loans are paid in arrears. It means the interest portion of the payment is for the last month's interst, whereas the Principal that is being paid is current principal. So, If you skip your last payment with the idea that it is just going to get paid off when the home sells, the only thing that changes is timing, not amount. The updated payoff the title company will obtain at closing will be higher than it is today as the interest that you did not pay in this payment, will accrue. You have 15 days before a late penalty kicks in on most mortgages. So, if your payment was due on the 1st of the month, you can pay it by the 15 and not incur a late payment fee. However, if the closing of escrow occurs after this grace period, then, not only will you have a higher payoff for the accrued interest, but now it will be higher by the amount of the late payment fee. Bottom line, you cannot avoid paying the bank that $1800 in interest. Either make your payment now, or you will net less money at close of escrow.
Home Loan - Escrow & MI?
"Escrow" is the additional portion of your payment that is put aside for the mortgage company to pay your taxes and insurance on the property. MI is mortgage insurance, which tells me you are not putting 20% down and are being charged for mortgage insurance, which protects your lender in case of default. In some cases, if you put at least 20% down, you may elect to pay your own taxes and insurance, but at no time can you NOT pay them. Your total payment is the higher amount.