Comments on: How to Break Free from Your Escrow Account

By: Teresa

Teresa — Tue, 02 Aug 2011 21:24:18 +0000

i fell behind four and a half months on paying my property tax. I only owe a third of what my house is now worth. I payed everything up in June and now they want me to pay them 3,800 towards an escrow account plus a higher mortgage. I had a mortgage with country wide but Bank of America took over my mortgage and is now screwing me

By: Amanda L Peacock

Amanda L Peacock — Tue, 21 Jun 2011 12:27:18 +0000

Hello Pamela!

Very interesting. Thank you for sharing that information. I guess Texas is not one of those states? (that’s where we live).

By: Pamela

Pamela — Tue, 21 Jun 2011 10:06:01 +0000

Fourteen states require lenders to pay interest on their escrow accounts. I’m earning more on my NY escrow account than I could get from any online bank so I’m not going to close mine anytime soon.

By: Ashraf Soliman

Ashraf Soliman — Sun, 18 Apr 2010 11:10:10 +0000

what about new jersey jurisdiction for escrow account , I realy need to eliminate this account, specially with this high real estate taxes in new jersey which consider as double your mortgage payments

By: DS

DS — Wed, 24 Mar 2010 01:15:17 +0000

Thanks for the info! I’m a fist time home buyer as well and my aunt keeps telling me that canceling your escrow account and paying taxes/ins. yourself will save you money. This is just the info that I needed!

By: Amanda L. Grossman

Amanda L. Grossman — Sat, 23 Jan 2010 16:44:27 +0000

Hello FV: Thanks for your comment! It is your homeowner’s insurance company (not your mortgage company) that will need to accept credit card payments. However, I am sure most, if not all, do accept credit card payments.

By: FV

FV — Sat, 23 Jan 2010 15:28:48 +0000

Excellent post!
You state that “Another great benefit of losing your escrow account is that you can now pay your homeowner’s insurance premiums on your credit card.”
I am not so sure everybody can pay by CC; this is possible only for those whose mortgage comp. actually accept CC payments. Am I wrong?

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Personal Finance – Second Edition | The Personal Finance Blog — Wed, 20 Jan 2010 05:39:31 +0000

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By: LC

LC — Sat, 16 Jan 2010 19:11:36 +0000

Grown-ups do not need somebody else earning interest off of their own money. The internet is littered with stories of escrow companies folding and not paying taxes and insurance.

By: Andy

Andy — Sat, 16 Jan 2010 01:45:34 +0000

Great piece and I did not realize that you could “take back” your escrow account. Definetly makes sense to use it for your benefit than the interest free loan to the bank. You may have just saved my some money here.

By: Friday Finance Findings for January 15th – Going Pro Edition : Generation X Finance

Fri, 15 Jan 2010 13:58:58 +0000

[...] How to Break Free from Your Escrow Account – Escrow. If you have a mortgage, you may already be quite familiar with this term. In many cases it’s a requirement, but if you can break free from the escrow you may be able to streamline your finances to your advantage. [...]

By: jimmy37

jimmy37 — Thu, 14 Jan 2010 19:50:38 +0000

The choice to use an escrow account is left up to the local jurisdiction. In my county and state, I don’t know of any law that makes it mandatory to let me handle my own escrow. When I asked about it for the last two mortgages, I was told it would cost me an extra 1/4 point for that privilege.

Obviously, these banks don’t want me to earn interest on my money. They want to keep it.

By: Amanda L. Grossman

Amanda L. Grossman — Wed, 13 Jan 2010 13:25:49 +0000

Edwin: Sure! You can pay your home insurance with a credit card, and then pay that off before the grace period ends. By doing that, you can gain reward points on potentially $1,000+ (depending on how much your home insurance is). I am not sure if property taxes can be paid by credit card…I want to say probably not, but definitely check into it. If so, there are more reward points you can earn by not having your money in escrow. Ofcourse, if you know you cannot pay off the entire payment by the end of the grace period, then that negates the reward points earned because you will owe a finance charge.

Thanks for the question!

Executioner: Ahhhhh–mortgage-free! What an exciting thought:). Thanks for the comment.