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Escrow shortage

Posted on: 23rd Mar, 2010 06:28 am
We were behind in paying our property taxes so the bank paid them. Now they have calculated a repayment plan which is higher than we can pay. What options do we have, if any?
probably not much, denise, other than trying to negotiate with them to reduce the payments under the plan.

what you may not realize is that property taxes take priority over the mortgage when it comes to who gets paid first on a sale, a foreclosure, etc. lenders get nervous when taxes are delinquent, and it becomes a necessity to ensure that the taxes get paid, so that's why they took the action they did.

presumably, they arrived at the payment plan based on the amount of tax that is due on an annual basis to your taxing authority. is it?
Posted on: 23rd Mar, 2010 08:50 am
Problem is that the mortgage is still in my step-father's name. The house is deeded to my sister and I and both my mom and step-father died within four days of one another three years ago.

I tried talking to the bank about the taxes, but they want to talk to my step-father which is obviously not an option. They have miscalculated 2010 taxes by $3k which is huge to have to pay right now monthly. I wanted to negotiate a repayment plan that would work for us, but they won't talk to us. The mortgage payments are current by the way.
Posted on: 29th Mar, 2010 10:11 am
what did you tell them when they indicated they wanted to speak with your step-father? if you've not alerted them to the deaths of your mom and him, then they're bound by confidentiality statutes to speak only with the borrowers.

as for the $3000 miscalculation - can you obtain documentation from the taxing authority to demonstrate to them that they've overestimated? that would seem to be a reasonable thing to do, and if you're dealing with reasonable people, they'll review it in that mindset. of course, if you're not dealing with that sort of folk, that adds a whole lot of additional drama to the proceedings.

do you have legal counsel? it may just come down to that, particularly in light of the state of the home's title relative to the mortgage debt. the lender is acting in its conservative milieu and you can't really fault them for that (regarding who they'll speak with); but you ought to be able to get to someone there who can commiserate with you and your situation and seek a reasonable (there's that word again!!!) solution.
Posted on: 29th Mar, 2010 10:30 am
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