Mortgage question

[Sangre Naranjada]

I'm getting tired of giving my mortgage company an interest free $6000 loan every year in the form of escrow accounts. I am happy with the loan and have no interest whatsoever in refinancing.

I am with Countrywide on a 30 year fixed note, interest rate at or near 5.75. I am financially disciplined enough to deposit the escrow money into a no risk, interest bearing account each month and not monkey around with it during the year.

What do I need to do to begin handling the escrow account on my own?

 

[ninerhorn]

call CW and tell them you want to handle escrow yourself.

Do not know what happens with the funds currently in your account but you will need to go thru servicing.

 

[madscientist]

yup.

so long as your note is less than 80% of your original purchase price.

if not, but appreciation has made the note rate less than 80% of the current value of your home, ask them to do a valuation. They may charge you.

Also how you would get MI removed if you have or had it.

 

[Sangre Naranjada]

OK, it's that simple then? I put 20% down when we purchased the house to avoid MI, so no problems there.

I noticed on GatorDave's thread madscientist said that starting up a loan and handling the escrow account yourself would result in a quarter point interest rate bump. Can I assume that's only applicable to a new loan with less than 20% down?

 

[GatorDave]

He misspoke. It's not a bump to your interest rate, it's a one-time fee of .25% of the loan.

 

[ninerhorn]

actually it can be done either way.

a one time fee of 0.25% can be charged or the rate increased to make up for that fee.

No idea how it works once you are in the house.

 

[Sangre Naranjada]

Wow. That was easy as it could be. They're cutting a check to me and I'm in charge of my own escrow. No muss, no fuss.

The only question was what happens to the excess balance on the mortgage payment currently in transit to them. They will apply it to principal, so I'm golden.

Thanks for the help.

 

[PacSER]

Thanks for posting your results. I have CW as well, so I am in the same boat.

 

[madscientist]

CW is pretty good as far as servicers go. others, like litton or ocwen are much more difficult to work with, but some of that is because they tend to buy subprime loans.

glad it was easy for you.

 

[chitwood]

B of A is handling my mortgage, and they told me if I wanted to get rid of escrow, I had to refinance, since the escrow was part of the original loan. ********.

 

[madscientist]

tell them that if they don't remove the escrows for you, you will refinance with another lender and see what they say.

 

[ninerhorn]

Chitwood,

that is crap. I would also let them know that you will refinance with someone else and take your perfect payment history somewhere else.

Hope all is well with you and your family. We need to get out and play some golf sometime.

If I can help at all with this shoot me an email at

[email protected]