Need Help- Escrow Acct Refund Check

[toledo13]

Hi all! We refinanced our mortage (YAY SAVING MONEY), and just recently got an Escrow (am I spelling that right?) refund check. I'm not sure what exactly to do with it...

1- Put it towards our new mortgage payments
2- Pay off 1 of 3 college loans fully, and partially another one
3- Pay off 1 of 3 college loans fully, and put the other half towards the mortgage payment
4- Just deposit it in our account and use it like we would any other check- towards grocery, necessities, etc.

I've never refinanced before, and am not quite sure if I'm going to have to pay this amount for our new account or what. HELP!!!

 

[minnie1928]

Hi all! We refinanced our mortage (YAY SAVING MONEY), and just recently got an Escrow (am I spelling that right?) refund check. I'm not sure what exactly to do with it...

1- Put it towards our new mortgage payments
2- Pay off 1 of 3 college loans fully, and partially another one
3- Pay off 1 of 3 college loans fully, and put the other half towards the mortgage payment
4- Just deposit it in our account and use it like we would any other check- towards grocery, necessities, etc.

I've never refinanced before, and am not quite sure if I'm going to have to pay this amount for our new account or what. HELP!!!

A couple of questions for you:

1. Are you escrowing with your new mortgage? If so, then this may be money that you've, in a sense, overpaid and is a refund.
2. Do you have an emergency fund of at least $1000?
3. What are the rates on your mortgage and your student loans?

 

[toledo13]

A couple of questions for you:

1. Are you escrowing with your new mortgage? If so, then this may be money that you've, in a sense, overpaid and is a refund.
2. Do you have an emergency fund of at least $1000?
3. What are the rates on your mortgage and your student loans?

1- I'm not sure. I would assume so
2- We sure do
3- Mortgage is 4.75%, and all loans are between 6 and 10%

 

[minnie1928]

First, I'd call your current lender to see if they are escrowing your taxes. The last thing you want to do is cut yourself short when your taxes are due.

Assuming that your escrow account is all good at your new lender, then I'd pay down the SL debt (highest rate first). Then I'd snowball the amount you are saving from your new mortgage payment and apply that to paying down additional principal on your student loans each month.

 

[Tinker'n'Fun]

For every year that I have had an overage in my escrow account I can count on a shortage the following year. If you are under on your escrow, you will need to make up the amount in a very short time span to keep your mortgage payment where it is now. Taxes go up every year (at least where I live). I would put the money in an account and pretend you never saw it. When you get the bill for a shortage in your escrow, you will have it. Last year we were unable to come up with the shortage and our mortgage went up $180.00 per month. Since you refinanced and your mortgage is probably now lower, use the difference in the mortgages to attack your debt. Good Luck.

 

[StitchandPooh'sMom]

We just refinanced, and we needed to pay three months of escrow at closing. I got a refund check today from the old lender - basically three months of escrow. I didn't net any money, so to speak, I just paid it already to the new lender. Have you closed on your refinance? You will likely need to pay some escrow at closing. If you don't have to pay escrow at closing, they might not be escrowing and you will need that money for taxes and insurance.

 

[goofy5]

I would pay off one of the loans.

 

[clh2]

I would absolutely investigate your propertay tax situation.

Do you have any way to check your balances online? If so - check what your escrow balance is, and make sure it makes sense compared to when you need to pay your taxes, as well as your homeowners insurance. and any other fees the mortgage holder needs to escrow on your behalf.

I am a major refinancer, and the one time we received a large check, it was in our best interest to send it to the mortgage company, as the check had been sent to us "by mistake" and really should have been forwarded to the new mortgage company in the first place.

Whatever you do, please do not get "caught" short.