Escrow check?

Yes, they miscalculated your taxes or your insurance or there was a change in either of them. You could end up owing as I have in the past, but I don’t send them an extra check, they just up my house payment for the next year to make up for it. In the beginning when you paid all those fees up front, that included taxes and insurance for an entire year, and each house payment after that was for your escrow, so you are never really behind in escrow payments.

This is a very typical scenario. The title company can only “estimate” what your escrow account will be charged based on the target closing date. If you closed a little earlier or later than when this was calculated there will be a discrepancy. The title company is well aware of this and they typically try to ‘round up’. So in your closing documents there should be a balance sheet showing what you paid at closing in taxes, insurance, HOA dues, etc.. Once the property actually closes, which by the way is NOT when you sign document, but when it is recorded, there is an accounting done of all debits and credits involved with the closing for both the buyer and seller, hence the refund check. Hope this helps!

thanks! That makes more sense now, I remember that years worth in advance, and if I’ve been adding to it all year, yeah.

jholler
We recently bought a house and got $$ back from escrow too. Part of the reason was because they over estimated some costs. Also, due to the housing slump, our house was reappraised at a lower value than the previous owners paid and our tax bill was lowered we got $$ back from that too.

In this economy, don’t look a gift horse in the mouth…enjoy!

Is it wise to spend an escrow check or is it better to send it back to the escrow account?