A couple of considerations before you decide to waive escrow:
1. Escrow Waiver Fee -
There will or will not be a fee associated with the waiver of escrow - depending on your contract. In our case, there was supposedly an escrow waiver fee of $800. However looking at our Settlement Statement, there was no item pertaining or even remotely related to the escrow waiver fee.
Anyway, I wanted to point out that this was our first time to learn about being able to do a waiver of escrow that we were so excited about the possibilities. Thus, we did not have the present-mindedness to see if we can negotiate waiving (redundant?) the escrow waiver fee. The good thing is that it seems that we were not charged an escrow waiver fee at all!
2. Your Responsibilities (if you do a waiver of escrow)-
Obviously, aside from paying the non-escrowed items directly and in a timely manner, the lender may require you to provide them with:
- evidence of your payment of the non-escrowed items
- evidence that your insurance is still in force and at the required coverage levels
3. Escrow Reestablishment by Lender -
The lender could re-establish an escrow if these happens:
- you do not pay any of the non-escrowed items in a timely manner
- you do not provide evidences of payment of the non-escrowed items.
- you are in default under the terms of your loan document
Again, depending on your lender's contract, there could be more stipulations on when they can re-establish an escrow account for you.
I am curious though if it is myself who gets tired of managing the non-escrowed items - if and how I can ask the lender to reestablish an escrow account for us? How much would they charge to reestablish an escrow account?
Something that I could dig on more later. But if you know the answer, let us know!
Meanwhile, do the above considerations frighten you against managing the non-escrowed items on your own? Or do they confirm your decision not to manage them yourself? Share your thoughts!
Back in North America
7 years ago