Home "owners": do you impound your taxes and/or insurance?

[Lupine]

Why or why not?

Prefer only homeowners vote in the poll but, if others can't resist a poll dance, go ahead and vote what you would choose to do and state why.

[Lupine]

I ask because I've done both. I've always impounded both tax and insurance payments on prior mortgages (2), choosing to maintain an escrow account from which the mortgage company pays these bills. On the refi we just completed, I've elected to pay these bills out of pocket so won't be paying into an escrow account. Why? Because at the end of the day I'm still responsible for the payments. If the mortgage company, for whatever reason, is late on a payment - they'll gladly pay the fees ... out of the escrow account. Case in point - my statement shows that the mortgage company was late on the tax payment, so my escrow account absorbed a 10% late fee on the payment. Noice.

I'm very good at budgeting, so I'd rather have the responsibility myself, if I'm paying the cost one way or the other. Plus might as well have the monies sitting in our accounts accruing interest instead of the bank cashing in on it.

[jsmc]

When I bought my place the bank required a escrow account and they royally screwed it up, miss a tax payment tried overcharging for my insurance and just generally sucked. After refinance made a deal with the servicing company that I would maintain my own escrow account. pay my insurance a year at a time and put away enough every month for the taxes into an account separate from my regular checking and savings that is only used for taxes that way there can be no mistakes and no chance of somebody(my wife) spending the money.

Just made my first tax payment and they went up by $200.00 but my place went down in value by $3000.00 PC needs to stop this silly estimating and go back to physically valuing property.

[OzzieBloke]

No. But I put a 50% deposit on my house and have a 10 year mortgage that will be paid off in 4 years. No need for it.

[swingline]

My taxes are paid through escrow and haven't had a problem in the 4+ years we've had the loan.

Your escrow getting hit with a late fee is complete BS and you should have been on the horn with someone getting it straightened out.

The only benefit I see to paying it myself would be having that money earning interest. I have enough bills to pay on-line/mail each month so having another on top of that doesn't appeal to me for what seems like little gain.

[Greasy]

We did escrow taxes/insurance on our old house, but chose not to on the one we're building.

I would rather keep that money on hand, and not have to worry about the bank screwing up.

[Bires]

No. Any impounding is giving the mortgage company an interest free loan.

I just stay prepared with a cash pile in savings.

[Lupine]

Originally Posted by swingline

Your escrow getting hit with a late fee is complete BS and you should have been on the horn with someone getting it straightened out.

Property taxes were due at the end of April, and the online statement shows the proper amount - which is what I check. The "1st half 2012 + penalty" bit is on the refinance settlement paperwork from the title company; I'll find out Monday why they entered it in that way - more likely the funds are still in Escrow since again the mortgage company's online records show the appropriate deduction, and this is simply a recording issue. Bottom line though, I'd prefer to have the responsibility. If it were a late payment, the homeowner is ultimately responsible, horn or not.

[Shadowless]

When me and my ex had our house we had an escrow account. Just makes it easier.

[Meteor|WAR]

On both my properties I have the mortgage company handling the tax and insurance payments through an escrow. I have enough bills to keep track of as it is, and in 5 years there's never been an issue with a late payment. Honestly, I wish I could have utility bills handled by someone else too.

[Meteor|WAR]

Originally Posted by oct13

I've always paid cash for cars and homes and avoided the added cost and hassle of financing.

Must be nice.

[Lupine]

Originally Posted by oct13

No, actually it wasn't. Instead of of stundent loans, I paid my way working two or more jobs while attending school part time. Instead of blowing money on beer and parties, I lived on beans and water and even slept in my car for a year. Instead of flashy sports cars or SUVs, I drove the cheap clunkers nobody else wanted to drive. And instead of financing a home as soon as I got a good job, I continued live frugally and was able to pay cash for one just a few years later.

Growing up I was often embarrassed about the cars my parents drove and envied the vacations and luxuries my friends' families seemingly could afford. Looking back though, I'm thankful for the lessons my parents taught me about living well within my means and understand the choices they made. It wasn't that they couldn't have chosen a luxurious and debt-ridden lifestyle, its that they chose to give us a much greater gift by providing an example of living well. Shame I didn't follow that example until much later in my life.

[koralis]

Many mortgagers require one or both, because they don't trust you to make the payments.

Previous mortgager had both. New one only does taxes.

[koralis]

Originally Posted by Lupine

Case in point - my statement shows that the mortgage company was late on the tax payment, so my escrow account absorbed a 10% late fee on the payment. Noice.

Go to your state's attorney general. If THEY are the ones paying it, they have the fiduciary duty to you to pay it on time. If they don't pay it on time, they should be sucking up the cost.

[Meteor|WAR]

Originally Posted by oct13

No, actually it wasn't. Instead of of stundent loans, I paid my way working two or more jobs while attending school part time. Instead of blowing money on beer and parties, I lived on beans and water and even slept in my car for a year. Instead of flashy sports cars or SUVs, I drove the cheap clunkers nobody else wanted to drive. And instead of financing a home as soon as I got a good job, I continued live frugally and was able to pay cash for one just a few years later.

Well good for you then.

If you managed to save up enough to afford to purchase a house in cash by just living frugle that's amazing. You must have had a decent income though, or got a steal of a deal.