Mortgage Impounds – What You Need To Know

Mortgage Impounds

If you own a home, you have probably heard of an impound account, sometimes referred to as an escrow account. So what is an impound account anyway, and is it a good idea?

An impound account is an account that is set up so that you pay your mortgage company a monthly amount, which they hold to pay your property taxes and home insurance. Since these bills only come due about twice a year each, many average Americans have a hard time saving for them and gladly give their money interest-free to the loan companies to take care of it. Plus, this just means one less thing for you to worry about. (Or does it? Read
on.)

Mortgage companies are in this for a variety of reasons. First, they get to kee

...

[Continue Reading at SavingAdvice.com]

This entry was posted in X Files. Bookmark the permalink.

8 Responses to Mortgage Impounds – What You Need To Know

  1. Jeremy says:

    Good advice to keep an eye on the account if you do have one. We were faced with an issue with our last home purchase where the escrow wasn’t linked to the property taxes correctly so they did not get paid as they should have.

    Luckily we caught it very quickly and were able to avoid penalties or fees but I can see how easy it would be for many people to allow this to go completely unnoticed.

  2. limeade says:

    I had a situation just this last December where the mortgage company paid the taxes, but they paid an amount based on last years property taxes. The new amount was a little higher and I had to follow up with them to make sure they would pay the full amount.

    I like what you say that it’s our responsibility to make sure taxes and insurance are paid.

    Here’s the rule of thumb I follow:
    Inspect what you expect.

    -limeade
    http://fiscalmusings.blogspot.com

  3. tanyetta says:

    now you tell me :)

  4. frugalmomof1 says:

    Thank you very much for this timely article. I have been thinking whether to drop my impound account, and your article brought up some great points that I had not thought about.

  5. Amy F. says:

    Thanks for this article, Tina. I didn’t know anything about mortgage impounds and I know the info will come in handy. I hate the thought of entrusting (and paying!) someone else to pay my most important bills for me when I know I’m more than capable of doing it myself!

  6. Amy F. says:

    Teri, I meant Teri. Sorry about that.

  7. swarovski says:

    Glad we don’t have that system in the UK. What a rip off!

  8. Marie says:

    I have recently discovered that my impounds servicer has been holding the payment each pay cycle and I have been paying a $250 late fee for the last 6 years. I didn’t discover this until I closed my impounds and reviewed the closing statement. Sounds like a sweet deal they have worked out with the county; the county gets the boost via late fee charges and the impounds servicer gets to play with my money a little longer to make a little more money off my money – and I get to pay the late fee and there is no report to the credit agencies until the second notice so I have been none the wiser. Any body out there ever hear of such a scheme?

Leave a Reply

Your email address will not be published. Required fields are marked *

*

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>