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Escrow for existing residential loans

Home Forums Flood Disaster Protection Act Escrow for existing residential loans

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  • #2604
    cmitchell
    Member

    Are banks starting to set up escrow accounts for flood insurance on existing mortgages on residential improved real estate loans or waiting until July 2014?

    #3122
    rcooper
    Keymaster

    Most banks I have talked to either already have escrow in place for their flood loans or are waiting until July 2014 to implement escrow on flood loans if they aren’t exempt from the requirement. Your bank may implement escrow for existing flood loans by having the borrowers sign an escrow agreement and sending them the initial escrow statement within 45 days of establishing the escrow account. However, there will likely be more guidance on this process as regulations are written so it may be prudent to wait and see what the regulations require.

    #5617
    tparker
    Participant

    We were exempt but wondering if the new Flood Act changes any of that? I tried to read the Exceptions and it’s confusing.

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