Escrow

[Mango]

Here's my take on the scenario:

New Century was servicing the toxic UBS-owned loans while they were making arrangements to buy them back. New Century was supposed to "collect and deposit into a third-party custodial account" the principle/interest/escrow payments received from the borrowers of the UBS-owned loans--but they allegedly kept the money instead.


$3.8 million owed to UBS + the borrowers escrow payments are now MIA.

.

Shelly, not to be argumentative, but here is what you said above. You offered your take on the situation. I asked for proof that mortgage escrow monies are missing from defaulted borrowers and/ or serviced borrowers.

UBS is alleging New Century didn't deposit the checks.
New Century was in the loan-servicing business until they sold it off after filing bankruptcy. Some of the Sub-primates serviced their toxic loans after they handed them off allowing them to continue feeding at the trough.

I would recommend anyone who has the opportunity should always take responsibility for mailing in their own insurance and tax payments--after all, who is on the receiving end of the risk for non-payment?

I hope folks do get the "bejeebers" scared out of them--maybe it will cause them to drag out their mortgage papers and read all that fine print they didn't read at the closing table so they know where they now stand and take more care when they sign on the dotted line the next time. Forewarned is forearmed.
.

Yes, people shoudl always know what they are signing, but there are many, many people who preferred to escrow taxes and insurance even though given the choice at no cost to waive it. Why because it is easier, and some people were afraid they would not budget properly when the next tax payments were due. Errors have been made by the largest most secure Banks, and yes, it's ultimately your responsibility to get the payment in, but I have never in 2o yrs. in the business heard of someone's money in escrow with a mortgage service just evaporating.

"...My fear with posting vague information is scaring the bejeebers out of people that escrow money is just disppearing, and people who are required to escrow just start mailing in principe and interest payments..."

Yes, no one should worry about monies kept in "escrow:"

Escrow money is always safe.



http://stlouis.fbi.gov/dojpressrel/pressre06/mortgagefraud012606.htm

http://stlouis.fbi.gov/dojpressrel/pressre06/embezzlement030906.htm

http://stlouis.fbi.gov/dojpressrel/pressre06/mortgagefraudscheme030906.htm


(just in one local area)

Capricious, I have seen title agents and lawyers hopping a plane out of the country who stole escrow monies.

Which is why there is insurance by the title companies who the abstracters/ agents put their deals through.
Same for lawyers with malpractice insurance.

Neither you or Shelly have shown me evidence that a mortgage servicer stole escrow monies yet.

 

[Capricious]

"...Neither you or Shelly have shown me evidence that a mortgage servicer stole escrow monies yet...."




I did not say it was "stole"


I said it was "apparently gone."


Even if it is only temporarily "gone," will the
tax collector and the property insurance
company wait on it to reappear?

What to do if your "mortage company" is in dire
straits? Keep an eye on your escrow totals and keep
enough cash on hand to make the tax and insurance
payments if it becomes necessary.

Excuse me if I find little reason to trust the "predatory lenders."

 

[scooterbug44]

There are reports from various sources that escrow money has not been paid to the tax collector or insurance companies like it was supposed to be. People only found out because for some reason the tax man still wanted $$.

 

[elgordoboy]

Maybe the escrow monies are somewhere like the social security lunchbox. I mean lockbox. Lunchbox would imply that what's inside could be eaten.

 

[Mango]

Neither do I Capricious trust subprimates/predatory mortgage Lenders, which is why I didn't sell subprimes loans, didn't give my business to title agents, but insurers directly, hail I didn't even do business with some Banks if their servicing dept was not up to my standards, but I feel that when someone posts something, and it's vague in respect to information, especially a subject that confuses people not in the industry, we have a responsibility more than just saying " money is gone". That can mean anything.

Then you post and get defensive when you used the word "escrow", (title of your thread) which it's context relative to this thread you mean collection of PITI (servicing) and post links to title agents who embezzled money, which is totally irrelevant, because I said that I never saw an escrow evaporate. (from a mortgage servicer)
In further discussion, I will use the word servicer or PITI (Principal, Interest Taxes and Insurance)

It may surprise you, but in the 20 yrs. in this business, I have worked for a major title insurer, so I have seen hundreds of those types of cases.

You weren't showing me anything new.

I don't profess to know everything in this business, and I am always open to learning more or something new, but if someone tells me "money is gone" I am going to request they be more explicit.
Hardly a lot to ask.

 

[Capricious]

"...Then you post and get defensive when you used the word "escrow"..."



Pardon, but I was not getting "defensive" in the least.

Just pointing out that you were misrepresenting what I wrote.

As to defensive, YOU are the one who keeps pointing out that
you did not "do" sub prime loans.

YOU are the one who claims to never have used title agents.

YOU claim not to have done business with banks that "did not meet your standards."

My friend, you are the one who seems to be "defensive."

I merely posted that I heard there were problems with escrow monies

YOU are the one who then got defensive and began posting long rambling rebutles.

But have a happy day regardless.

 

[Capricious]

Some comments as to what can go wrong with
insurance and tax escrow monies:

http://tinyurl.com/28xyml

If "bad things" can happen in good times, how
will the current turmoil in the mortgage business
affect ?

Also some comments that some sub-prime loans did not
require escrow.

When I refinanced into a 5.5 % fixed (Not "cash out") a
few years ago, I would have had to pay a premimum to avoid
escrow, even through the loan amount was less that 30% of
the then- current value of the property.

Guess I was not "sub-prime"

 

[Mango]

I am seeing reports that bankrupt/closed/vanished mortgage servicers are not making tax/insurance escrow payments.

The escrow money is apparently gone.

How can one misrepresent what you say when you post a vague and inexplicit accusation without supporting documentation?

Definitions of gone on the Web:

• [SIZE=-1]
• away(p): not present; having left; "he's away right now"; "you must not allow a stranger into the house when your mother is away"; "everyone is gone now"; "the departed guests"
• done for(p): destroyed or killed; "we are gone geese"
• asleep(p): dead; "he is deceased"; "our dear departed friend"
• having all been spent; "the money is all gone"
• bygone: well in the past; former; "bygone days"; "dreams of foregone times"; "sweet memories of gone summers"; "relics of a departed era"
• gone(p): no longer retained; "gone with the wind"
  wordnet.princeton.edu/perl/webwn[/SIZE]

Have a nice day too.

 

[spinDrAtl]

Some comments as to what can go wrong with
insurance and tax escrow monies:

http://tinyurl.com/28xyml

If "bad things" can happen in good times, how
will the current turmoil in the mortgage business
affect ?

Also some comments that some sub-prime loans did not
require escrow.

When I refinanced into a 5.5 % fixed (Not "cash out") a
few years ago, I would have had to pay a premimum to avoid
escrow, even through the loan amount was less that 30% of
the then- current value of the property.

Guess I was not "sub-prime"

What do you mean by 'pay a premium'? A fee? As I stated above, the escrow waiver fee for ltvs of < 80 is typically .0025 x loan amount. Cash out is irrelevent to the escrow waiver.