Escrow Waiver Fee

[freshsqueezed]

If you have refinanced lately and did not escrow, did you have to pay a fee?

I’m going through this with a mortgage broker. Once I told them I don’t escrow it changed the lender credit and will cost me an additional $529.

[k3am]

We refinanced in Nov 19 (which.. seems like yesterday, but.. isn’t) and didn’t have to pay any fee like that.

[sandandsea]

We have never had to pay to stop escrow.

[puppylove64]

Last mortgage we didn’t escrow. The lender didn’t realize until after he has told me the fees. He said no escrow is usually higher but he waived them since it was his fault he didn’t charge them upfront. Again his mortgage, he said rates and fees are higher with no escrow accounts.

[Susie]

We closed in October 2019, and no, no fee to waive escrow.

[elcjet]

I always manage my own escrow and have never paid a fee when refinancing for that.

[turkletsmom]

We just closed on our refinance 2 weeks ago. We were told our interest rate would be .15% higher if we did escrow on our own.

[freshsqueezed]

Oct 21, 2020 10:04:30 GMT -5 turkletsmom said:

We just closed on our refinance 2 weeks ago. We were told our interest rate would be .15% higher if we did escrow on our own.

Thanks. I’m wondering if they are implementing this more now on recent loans, I’m talking last few months.

I also refinanced last October and didn’t have it so I was wondering about recent loans.

Thanks

[turkletsmom]

Oct 21, 2020 10:09:49 GMT -5 freshsqueezed said:

Oct 21, 2020 10:04:30 GMT -5 turkletsmom said:

We just closed on our refinance 2 weeks ago. We were told our interest rate would be .15% higher if we did escrow on our own.

Thanks. I’m wondering if they are implementing this more now on recent loans, I’m talking last few months.

I also refinanced last October and didn’t have it so I was wondering about recent loans.

Thanks

Yeah another difference right now could be if you go through a big lender vs. a small credit union, etc.  

[freshsqueezed]

Oct 21, 2020 10:13:03 GMT -5 turkletsmom said:

Oct 21, 2020 10:09:49 GMT -5 freshsqueezed said:

Thanks. I’m wondering if they are implementing this more now on recent loans, I’m talking last few months.

I also refinanced last October and didn’t have it so I was wondering about recent loans.

Thanks

Yeah another difference right now could be if you go through a big lender vs. a small credit union, etc.  

Could be. I was trying to stay with a small local place but no one could get me near what i wanted. But in the end this guy got me my best rate and my total fees are $919 so I’ll be proceeding.

[froggy76]

Sort of. We just refinanced and got a significant lender credit. When I asked to waive escrow, they said they would reduce the lender credit, so we decided to keep the escrow. I think the difference in lender credit was close to $800 but the details were a little murky because there were a lot of moving parts as the loan disclosure was being finalized.

[ny96]

We just completed our refinance and there was no fee and our rate was not higher because we chose not to have an escrow account.

[flygirl]

We just closed in Sept 2020 and didn’t have a fee thru our credit union. Are you below 78% RTV?

[freshsqueezed]

Oct 21, 2020 12:39:37 GMT -5 froggy76 said:

Sort of. We just refinanced and got a significant lender credit. When I asked to waive escrow, they said they would reduce the lender credit, so we decided to keep the escrow. I think the difference in lender credit was close to $800 but the details were a little murky because there were a lot of moving parts as the loan disclosure was being finalized.

This is my exact situation. Credit change. I don’t want escrow though so I’m just going to pay the $529 difference I guess, though I feel like this isn’t financially smart.

[madisen]

This is loan program, state, and LTV specific. And then everything is lender specific if a lender chooses to have their own overlay.

Usually it’s .15% not in rate but in cost/fees/pricing. That’s multiplied by the loan amount to find the cost.

And generally it’s conventional loans, higher LTV’s, and non-CA states.

[scout8]

In Illinois, the interest rate was usually higher if a borrower chose not to escrow. It's been like that for as long as I was in real estate so not something new.

[Cappy]

This was one of our first questions we asked before a refi bc I'd heard about this fee and/or higher rates. If I was charged and stuck in that loan I think I'd opt to escrow vs. pay a fee. I do love that we don't escrow. There's so much flexibility and I feel more in control.

[Accountingcat]

Yes, I think the fee was $400 and I had to buy points because I didn't qualify for the interest rate without escrow. In total it was less than $800. My broker said it was a fanniemae rule, I don't know if that's true though. I ended up doing it because I'd earn more in interest on my escrow than the fee was (high property tax area).