My lender raised the escrow by $150 a month to pay their estimate of future tax and insurance. I calculate it should have gone up only $50 per month to cover the increase in insurance, or $600 more per year. Can I contest this? What happens If I dont pay the extra?
You certainly can ask the bank for an explanation of its escrow analysis. The bank is entitled to make the payment sufficient to pay the estimated taxes and homeowner's insurance payments for the coming year, and provide a cushion of no more than two month's payments at the time of the lowest forecasted balance.
When the bank informed you of the increase, it should have provided a report of its analysis. If you didn't get the analysis or it is not clear to you, ask for an explanation.
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You certainly can ask the bank for an explanation of its escrow analysis. The bank is entitled to make the payment sufficient to pay the estimated taxes and homeowner's insurance payments for the coming year, and provide a cushion of no more than two month's payments at the time of the lowest forecasted balance.
