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Old 07-12-2020, 03:30 PM   #21
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I never escrow for taxes and insurance even if I have a mortgage. I like having control and making sure that only the exact amount is paid.

For taxes, I just have an idea of what it will be and make sure I have enough money when it is due.

For insurance, sometimes there is a discount to paying it all at once or by the six months. Sometimes there is no substantial discount. So, I just look at what is most advantageous at the time and choose that. On the insurer's website I can change how I pay (anything from monthly to annually) any time I want to.
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Old 07-12-2020, 03:32 PM   #22
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Tax bill divided by 12, sent to savings automatically each month. Reminder on calendar to cut/ mail check 30 days before tax bill due. Draft back from savings to replenish till.

Homeowners, lumped with all the other insurances paid as spread out as they will allow me with no penalty. On autpay monthly out of the till
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Old 07-12-2020, 03:46 PM   #23
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Quote:
Originally Posted by COcheesehead View Post
I havenít escrowed taxes or insurance for years. I always asked to do it on my own when I discovered errors in accounts.
Quote:
Originally Posted by pb4uski View Post
+1 The mortgage servicer always seemed to screw it up so I elected to pay them myself.
+2

That was my experience also when I had a mortgage. Every year I'd get nastygrams from the insurance company and the County that the bills hadn't been paid on time. While I was never penalized for their screwups, when I refinanced for a lower interest rate (this was late 1980's) I asked "Do I have to have the taxes/insurance escrowed?" and the answer was that I did not. Since I knew about what the bills would be it was a simple matter to put 1/12 of that amount aside every month and then pay it when the bills arrived.
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Old 07-12-2020, 04:08 PM   #24
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We pay insurance once per year, which is the cheapest option. It goes on the Fidelity 2% cash-back credit card.

Property tax is also paid once per year. I'm not aware of any other options in Texas. We have 3 taxing jurisdictions, but it all comes on one bill from the County. They charge more than 2% to pay by CC, so that's one of the few items we pay with online bill-pay .

I hated escrow accounts. Our last mortgage was originated in 2004 and had no escrow, but it took some negotiating to get it removed. DS's mortgage company required escrow if LTV > 80%. DD is shopping for a mortgage right now with >20% down. Some companies are telling her that the interest rate is higher if she opts out of the escrow requirement. It's become a profit center.
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Old 07-12-2020, 04:16 PM   #25
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Many of the servicers require escrow accounts with loans. To prevent borrowers from missing payments. Not withstanding loan servicers screw ups. I always wanted to be in control of the property tax & insurance payments. I think the escrow requirements became more common in/after the Great Recession. Plus they get a bit of vig on the interest

For some lenders, it depends on the ratio of the outstanding loan to the house value. If you request to not use escrow, if the outstanding amount is low enough and the value of the house high enough, some will end the escrow account. Our original loan had an escrow account, but when we refinanced, due to the above items, it was not required and the lender gave us the option of having an escrow account or paying the taxes/insurance ourselves.
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Old 07-12-2020, 06:23 PM   #26
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School tax twice a year, regular tax twice a year, ends up being a check every quarter.
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Old 07-12-2020, 06:28 PM   #27
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I think the options may vary a lot by locality.

My county gives a 3% discount to pay annually, otherwise it is in 3 equal payments (Nov, Feb., and May). I pay annually mostly to avoid the hassle of needing to mail 3 checks. The online payment option with the county charges convenience fees.
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Old 07-12-2020, 06:35 PM   #28
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I am planning on paying off my mortgage around Sept - Oct time frame. I never considered what my options would be to pay the taxes and insurance moving forward. I'm ASSuming that once the P and I is paid in full the loan will be closed by the lender and the annual taxes and insurance (which were paid through escrow monthly) will be all up to me. Can the taxes and insurance still be paid monthly, or is this something that now needs to be paid in full annually?

Sorry......I haven't done any research as of yet. Just thought I'd throw this out as I'm sure there are many on the forum that have paid off a home. This will be my first!

Thanks
Mike
congratulations on paying off the mortgage!! ours has been paid off since ~ 2003. we closed our mortgage escow account as soon as possible after taking out the mortgage, right around 1995, so we’ve been paying our RE taxes and insurance ourselves for 25+ years now.

our real estate taxes are billed/paid twice a year, 1st half due June 1, second half due September 1. one strategy is to budget for those expenses like any other and set aside 1/12 of the estimated amounts each month in a separate account or keep track in a spreadsheet. i estimate next year’s tax bill by adding 5% to the cuurent year bill.

for the last 8-years we’ve set aside 100% of net SS income each month in the current year for next year’s prop tax and some other expenses. doing this or other strategies requires discipline but as time goes by it becomes second nature.
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Old 07-12-2020, 09:50 PM   #29
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Property taxes here are due in December for the first half and June for the second half. I used to pay it all at once when I could deduct it on schedule A; now that I can't I do two payments a year just to help even out the spending throughout the year.

Once the mortgage is paid off, you may want to revisit your homeowner's insurance coverage. Some mortgage companies can require a certain level of coverage and you may be comfortable with less. I raised my deductible quite a bit and lowered the total amount of coverage as well after I paid off my mortgage. Note that there are risks with this approach, so understand them and make sure you're OK with them first.
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Old 07-13-2020, 03:45 AM   #30
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Originally Posted by rk911 View Post
congratulations on paying off the mortgage!! ours has been paid off since ~ 2003. we closed our mortgage escow account as soon as possible after taking out the mortgage, right around 1995, so we’ve been paying our RE taxes and insurance ourselves for 25+ years now.

our real estate taxes are billed/paid twice a year, 1st half due June 1, second half due September 1. one strategy is to budget for those expenses like any other and set aside 1/12 of the estimated amounts each month in a separate account or keep track in a spreadsheet. i estimate next year’s tax bill by adding 5% to the cuurent year bill.

for the last 8-years we’ve set aside 100% of net SS income each month in the current year for next year’s prop tax and some other expenses. doing this or other strategies requires discipline but as time goes by it becomes second nature.



Thank You to everyone that has chimed in on my question. I did find out that I can pay my property taxes quarterly:

June 30th - 6% discount
Sept 30th - 4.5% discount
Dec 31st - 3% discount
March 31st - No discount


It looks like my options are either the quarterly payments or 1 annual payment due by 1 April of the tax year in question.


I will be speaking with my homeowner's insurance agent today!


Thanks again everyone.....this is just another milestone met by wife and I and we are excited about it.



Mike
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Old 07-13-2020, 04:00 PM   #31
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It looks like my options are either the quarterly payments or 1 annual payment due by 1 April of the tax year in question.
I had forgotten about the discount, we get 2% off if paid before Oct. 1 when due so of course we always pay it in September.
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Old 07-13-2020, 05:40 PM   #32
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FWIW your area's R.E location might offer various tax discounts.
Elderly & Armed services DAV come to mind.
Should you have an armed services discharge of X%DAV, your towns tax scheme is usually discounted also, ...in some locations anyhow.

Ask around, before you make unnecessary R.E tax scheme payments,... unknowingly.
They're non refundable should you pay the tax scheme first.
Keep in mind insurance agents conflict of interest considering receive commissions, fiduciary is a farcical term in all mannerisms imo.

Good luck & Best wishes....
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