Banks suck at projecting escrow payments

posted by Jeff | Thursday, March 3, 2005, 6:36 PM | comments: 8

For the fourth consecutive year (that being all of the years we've owned our house), the bank has managed to make a piss-poor estimate at how much we should be paying toward our escrow account for taxes and insurance, and again we're short almost $600.

Our insurance went up by more than $130 for the year, which is insane. Our taxes went up nearly $200 a half, which is also insane. I don't recall any new tax levies passing, only renewals. Then again, who knows, because if it's for the schools I probably voted for it.

So now I can either pay the nearly $600 short amount, or roll it into the next year's payments at $50 a month. I don't really have a choice. I can't afford right now to drop that much money into the account, so it's pretty obvious what I'll have to do.

The first year was the worst, because they projected it wrong by something like $1,200 for the year (they were calculating on the value of the unimproved lot). I guess I'm sort of getting off easy this year.


Comments

Stephanie, March 4, 2005, 12:25 PM #

*sigh*

freeze, March 4, 2005, 2:17 PM #

Banks suck and this just in...the earth has one moon.

You better watch out for those damn school levies. Yeah, it's for the schools, but where? For the books, the building, or the teachers' raise. I can see in the low income areas, but you guys don't exactly live in the 'hood.
There's a situation in Green, where a new school was just built a few years when a levy passed. Now, there's another levy on the ballot...for the schools. This time for the teachers, who need a raise from the average $50,000 they're making from the 180-day/year job. Taxes are incredibly ri-GOD DAMN-diclous already over there.

gregleg, March 4, 2005, 4:15 PM #

My girlfriend works for a bank, in the Anti-Money Laundering group.

She's told me a bunch of little tips, such as the obvious "NEVER make a deposit at an ATM, hand it to a teller and get the receipt". She tells me that one time she was waiting in line at her bank (which happens to be a branch of the bank she works for), and the teller told her "You know you can just make that deposit outside..." She replied "Sure, but I work in corporate so I know better." The teller replied "Oh..." and moved along.

Jeff, March 4, 2005, 5:07 PM #

I've never lost an ATM deposit in 15 years.

Dennis, March 4, 2005, 6:35 PM #

A school levy renewal can raise your taxes. Usually it's being renewed at the rate it was originally passed at (say, 5 mills), but before it's renewed, it's only being paid at 1.9 mills, because of growth in the district (the payments are spread out among more people).

freeze, don't be confused by the different types of levies. A bond issue can be used ONLY for construction. A permanent improvement levy can be used for books, computers, buses, etc. Only an operating levy can be used for salaries. That's why your district has to keep coming back to the voters.

And also, because Ohio's legislature REFUSES to fix the unconsititutional school funding process. It's not your district's fault they need more money, it's the state's fault for forcing it to use crappy methods to get the money. But voting "no" hurts only your schools, so it's a Catch-22.

freeze, March 4, 2005, 7:02 PM #

I learn something new everyday...

Jeff, March 4, 2005, 8:22 PM #

Right... I went through all of that nonsense when I was working in Medina. Perfect example of a well-to-do community that struggled to pay the bills. I can accept bond issues since they're a one-off expense, and decline in millage over time, but the operating levies it just depends.

Maxairtime, March 8, 2005, 1:29 AM #

I had an incident with the bank where the clowns forgot to pay our property taxes. When I called them about it, they gave me the lame excuse that they never received the tax bill from the county. Yea..right!! It was tons of fun making sure the idiots not only paid the delinquent taxes from the escrow, but paid the automatic 10% penalty from their own funds and not from the escrow.

That was the last chance any bank was going to pay my insurance and taxes. So I now pay them myself. Set yourself up on an installment plan for the insurance and you can do a better job of estimating your tax bill than the bank can.

During my last refinance, you should have heard the response I got from the loan officers when I told him I would cancel the whole deal one day before closing because they "insisted" on paying the taxes and insurance through escrow. They wanted to charge me a higher rate if I didn't agree to it. But I didn't like the fact they didn't bother to disclose this until one day before closing.


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