It's so fun to win

    It's so fun to win

    Oct 27, 2017

    Part II- Impounded property tax issues

    Many people, myself included, choose to pay their property tax and maybe insurance premium along with their mortgage payment. Lenders generally sets up what is known as Escrow account or Impound account for the collection of funds to cover the homeowner's insurance & property tax when it is due, on behalf of the borrower/homeowner. This is a convenience for the borrower so there is no payment shock when the bills are due and, it gives the lender a better peace of mind that those bills will be paid on a timely basis, so their interest in the property is not threatened.

    This practice does generate some question as to the timely payment of your individual tax bill because lenders' practice in making such payment for their borrowers is not to write 500 checks for each 500 individual borrower's account. They make one payment to the tax Assessor for all the borrowers they have escrow account for. Consequently, this might cause some delay in your account being credited as fast as one would like.

    I am not writing this to alarm you as I have not ever encountered problem thus far after owning multiple properties over several decades with the property tax impounded with the lender. Just be aware of this fact so that in the event you have trouble, you will know what to do.

    In case you're wondering what is happening on the case I mentioned about my buyer receiving a notice on seller's delinquent tax not paid prior to close of escrow, as of today, it seems the buyer's lender has the wrong APN number for his loan. Duh, no wonder...

    Tomorrow, I'll write about supplemental tax, a most confusing issue of all that I get calls on at this time of the year.

    Your, Truly,

    Sin-Yi Lambertson

    ERA Yes! Real Estate

    Yes Mortgage