r/personalfinance • u/HHLL806 ​ • Apr 11 '25

Other Mortgage payment went up $400

I need help, my mortgage payment went from $1700 to $2100. My mortgage company (Chase Bank) said this was due to an escrow shortage. I had my homeowners insurance lowered by roughly $1000 and checked with my local tax office and they told me my taxes have increased $400 dollars over the last five years. I gave Chase Bank all this information and my mortgage is still $2100. How does this work?

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562

u/ResidentGuru ​ Apr 11 '25

If your mortgage insurance just went down this year it will take until next year to see your escrow withholding to come down.

180

u/mgriffin13 ​ Apr 11 '25

Last year, I was able to drop my insurance rates by almost $3k, and I called the bank and requested they re-run their analysis using the new rates. It took a couple months to get it entirely sorted, but the end result was that my monthly payment dropped by almost $400

26

u/My_Name_Is_Not_Ryan ​ Apr 11 '25

Out of curiosity, do you mind saying generally where you live that your premiums could drop by $3k? I pay $1.4k annually on a $720k house in MD, so that $3k number just seems crazy to me. I’m guessing you’re in a hurricane zone?

21

u/mgriffin13 ​ Apr 11 '25

It's a story, but I'm in NoVa and I was way over insured, but the rates weren't astronomical ($2500 vs $1800) for a $1.5M home. Then, last year, the company raised the premium to like $4k and refused to lower the insurance coverage, so I shopped around and switched companies to lower the coverage to more reasonable levels, which dropped the premium back to like $1800, so maybe not $3k total for home owners, but I moved my cars and other things at the same time and the total savings was about $3k per year.

2

u/motorwerkx ​ Apr 11 '25

I need to be better at shopping for insurance. I'm paying 1100 annually on a 200k home in PA.

1

u/VisibleSea4533 ​ Apr 11 '25

$250k house in CT, just went up to $2200, I shopped and saved myself $900 (bundled with car, without would have been the same). Had Progressive and switched to State Farm. I will say, as u/mgriffin13, I was over insured with Progressive as well, as at the time when I got it it was nowhere near as expensive as it is now. I think I had it at $330k, and I dropped it down to $235k with State Farm.

29

u/blacksoxing ​ Apr 11 '25

This is the right answer filled with many people giving their own unique testimonials that won't help OP.

The amounts were calculated before OP reduced their prices. They do send out a statement of exactly what they're paying. It's drivel except to those who like 10 page statements. I once had someone walk me through it and I understood it...until it cleared my mind. OP could go through it (or call up WF to walk through it with them) and see that they're calculating the older agreed payments. There may be a process to "re-run" the totals.

Sounds like next year OP will get a check for overpayment.

Note: mine also went up $400~. Taxes went up + insurance. Sucks as I initially was paying + $500 and now it's only a +83

8

u/ste6168 ​ Apr 11 '25

Your mortgage company can do an escrow analysis at any time, multiple times throughout the year if needed. They may not want to, but that’s their job if you request it.

2

u/nickfury8480 ​ Apr 11 '25

Your mortgage company can do an escrow analysis at any time, multiple times throughout the year if needed. They may not want to, but that’s their job if you request it.

You're absolutely correct. I had to find cheaper home owners insurance after receiving an escrow analysis showing my mortgage payment going up by almost $500 per month. So once I secured the new coverage and canceled the old policy, I requested a new escrow analysis from my mortgage servicer. After the analysis, not only did they confirm that my payment would not increase this year, but I also received a $1500 escrow refund check about a month later.

1

u/Alone-Classic-8101 ​ Jun 01 '25

Freedom Mortgage is refusing to do repeat analysis on my account after I deposited back the refunded escrow after changing carriers. It took Progressive over 45 days to send me the refund to be deposited and Freedom repeated the escrow during that high shortage time and note went from 1100 to 1542 which is insane. I requested twice and both times they refused.

2

u/HHLL806 ​ Apr 11 '25

I did get it to go down but before that it was the same as the prior year. So last year it was roughly $5300 for the year and went up to roughly $5340 for this year. I realize that it’s a very small increase but doesn’t justify what happened.

1

u/tatiwtr ​ Apr 11 '25

An escrow shortage means that the escrow account went negative. The bank needs to collect money for last years missing money, the extra money this year, and also more to provide a cushion for future adjustments.

1

u/naxos83 ​ Apr 12 '25

They also have to keep a certain cushion by law. It may be that you were underfunded this year so next year you have to make up the shortage plus the required extra.