Sunday, December 10, 2006
Tax Question from a listener.
Question: If monies are escrowed by a lender to pay real estate taxes and they're not paid in a timely manner, resulting in late penalties or tax penalties, who is responsible?
Answer: If the escrow account had adequate funding to pay the bill, the lender is responsible.
Lender escrow accounts are typically allowed to retain enough money to pay taxes and insurance bills as well as the equivalent of two additional monthly escrow payments plus $50.
Given that a home can be foreclosed if local tax bills are not paid, lenders have a strong duty to assure that such payments are made. For details, speak with a local attorney.
Answer: If the escrow account had adequate funding to pay the bill, the lender is responsible.
Lender escrow accounts are typically allowed to retain enough money to pay taxes and insurance bills as well as the equivalent of two additional monthly escrow payments plus $50.
Given that a home can be foreclosed if local tax bills are not paid, lenders have a strong duty to assure that such payments are made. For details, speak with a local attorney.
