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Anyway out of a lender escrow account for property taxes?

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    Anyway out of a lender escrow account for property taxes?

    I live in California, near Los Angeles.

    Long story short, I had a NOD filed on March 8, 2011. Once my family found out, they offered to help me.

    My family pooled some money together to catch up on all of the house payments. So my house is no longer in foreclosure. Though I have “forced lender homeowners insurance”, I am taking care of that in the next 2 days and will have my own homeowners insurance once again. So this will make the forced lenders homeowners insurance problem go away.

    Yet when I fell behind in my mortgage payments last year, I could not afford the almost $3,500 property tax bill that was ½ due on December 10, 2010 (the first installment) and also ½ due on April 10, 2011 (the second installment). So in the process, I paid that entire tax bill on April 25th. However in January, I was hit with a new assessment fee on my property for approximately charge of $2,500. So that amount was showing as outstanding on the records as of April 25th.

    So now that I am out of foreclosure, yesterday I received a letter from my lender (Bank of America), dated April 27th, stating that they are going to front the money to pay all of my past due property taxes and late penalties. Then starting next month, they will be adding an escrow account to cover my future property taxes and that my monthly bill will be going up to cover this, to protect their interest in my property. Though my family can help me with my mortgage payments, however there is just no way in the world we can afford to have approximately $500 more per month added to the bill. We had planned on paying the remaining taxes by June 1st (to avoid any further penalties), however I just wanted to know if there is anything I can do or say to Bank of America to stop them from adding this escrow account and charging me any extra monthly charges? Since me and my family are trying so hard to keep the house, yet B of A seems that they are almost doing everything they can to put me back in foreclosure again.

    Due to the declined real estate market here, I can have my property reassessed anytime after July 1, 2011. So I am sure that my property taxes will be approximately $3,000 once that is done, so when I receive my new property tax bill in late September or early October (this year), it should roughly reflect this amount. Before my B of A letter arrived yesterday, what my family and I had planned to was to make the first installment payment by the deadline date of December 10, 2011 . . . because that will give us time to save the money for that between now and December. However with B of A putting such a HUGE demand and requirement, we don’t stand a chance under those circumstances.

    Any help or suggestions will be greatly appreciated.

    #2
    Unfortunately, I do believe the lender has the law on their side regarding creating the escrow account. Check out your mortgage docs, it should be detailed in there.

    I went back and read a few other posts you've made, trying to get a better understanding of the issues going on for you. I am assuming your family has loaned you the funds to get the house out of foreclosure, and you may have to pay that back. (I could be wrong). However, I hope you carefully consider that sometimes it is best to know when to walk away. I honestly do understand wanting to save the house, but it appears (again, I could be wrong) that this house is just too much of a financial sink-hole for you at this time. Hopefully things have changed for you, but the reality is that unexpected expenses always appear and if you are barely hanging on...well, you are only delaying the inevitable, however now you also owe your family.

    I guess I am just trying to not offend, as that is not my intention. But to please weigh your options carefully because struggling so hard to save this house with everything else going on, might bite you in the tail down the road. Look at this with your "it's only business" eyes, and be sure you get a clear picture of the situation.

    I sincerely wish you all the best. These financial trials are tough, and the decisions that have to be made are tougher yet.
    8-07-09-filed Chapter 7
    11-18-09-DISCHARGED!!

    Life is not what challenges you face, but how you face those challenges.

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      #3
      Thank you NoMoreCards. I greatly appreciate your help and detailed and thorough feedback. Thanks so much for your advice, and no offense taken. :-)

      Comment

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