This is part of our ongoing series on the basics of owning a home.
When you pay your mortgage bill each month, some of the money will be stored up in escrow to cover your taxes.
However, lenders aren’t the only keepers of escrow accounts. They can be managed by various qualified entities, from escrow agents to real estate attorneys and title companies.
Regardless of who oversees your account, administrative errors do happen. It’s important to watch out for them as, in the end, you’re the one responsible for paying your bills. Here are some possible escrow mishaps and how to avoid them:
Incorrect tax rates
Be sure to understand the property taxes in your area. Your local government’s website should have rates, along with contact information for the assessor’s office in case you have questions. Confirm that the correct rate is being used to determine your property taxes and watch out for miscalculations.
Missed due dates
Note your tax and insurance due dates, and check to see that your bills are being paid on time.
Your mortgage statement shows both the balance of your escrow account and how much of your current payment is going into it. Make sure you’re on track to have enough in escrow to cover your tax bill.