What is escrow?
Escrow is a separate amount collected along with your scheduled mortgage payment. The funds are collected
to pay your future annual insurance
premium and/or taxes. The funds accumulated in the escrow account may
not be used for any other purpose.
What are the benefits of having an escrow account?
An Escrow Account allows you to set aside funds for your annual insurance
premiums as well as taxes (if
applicable) without the burden of providing the total balance upon policy renewal and/or notice of taxes
What is an escrow agreement?
An escrow agreement is an agreement between the lender and the customer to collect funds to pay insurance
and/or taxes. This agreement is signed at loan closing and is binding for the life of the loan.
Is an Escrow Account required?
for maintaining your insurance
and/or taxes. Because the Escrow Agreement is valid for the life of the loan,
the escrow payment may not be discontinued.
Why do I need homeowner's insurance?
coverage is required to protect you, as well as the Lender, against physical damage and/or loss of
value to the home.
How is my initial escrow payment calculated?
Your initial escrow payment will be equal to 1/12 of the total disbursements payable throughout the year.
If you are on a bi-weekly payment plan, your escrow payment will be 1/26 of the total disbursements payable
throughout the year.
Will I be escrowed for taxes?
The state of Texas requires lenders to escrow taxes for loans with contract dates after June 18, 2003.
If you entered into a Tax Escrow Agreement in another state, you will have an escrow payment for taxes.
What is an Escrow Account Analysis?
This is an annual review of your escrow account performed by Vanderbilt
to determine if your current escrow
payment is sufficient to pay your insurance
premium(s) and/or taxes. The Escrow Analysis is conducted
approximately 45 days prior to the anniversary date of your loan. Adjustment(s) to your escrow payment
as well as any refund amount due to you will be determined at this time.
What is an Escrow Account Disclosure Statement?
This is an annual report distributed in accordance with the requirements of the Real Estate Settlement
Procedures Act (RESPA). The Disclosure Statement will provide you with a detailed summary of your escrow
Could my escrow payment change more than once annually?
Yes. Because your escrow payment is determined by your insurance
policy premium, it may adjust with any
changes to your coverage and/or insurance
company. An increase in your insurance
premium requires an
increase in the escrow payment. Likewise, a decrease in your insurance
premium requires a decrease in
the escrow payment.
What is an Advance?
An “advance” is a separate amount that is collected along with your scheduled mortgage payment for any
expenditure that Vanderbilt paid on your behalf for items not described in your Escrow Agreement such as
delinquent property taxes, Lender Placed Insurance Policies, etc.
Can my account have both an Escrow and an Advance payment?
Yes. For example, you may have a total monthly escrow payment based on both insurance
delinquent taxes paid by Vanderbilt
on your behalf. The payment for insurance
would be considered
your Escrow Payment, and the additional payment for delinquent taxes paid on your behalf would be considered
What happens to the money in my escrow account when I pay off my loan?
Any surplus balance in your escrow account will be refunded to you.
Will Vanderbilt contact my insurance company before my insurance policy expires?
No. It is the responsibility of our customer(s) to ensure that Vanderbilt
receives proof of insurance
coverage on the home annually.
What should I do when I receive the renewal notice from my insurance company?
Review the notice to confirm that Vanderbilt Mortgage
is listed as the Mortgagee. Please note that your
loan number must appear on the policy Declaration page to ensure both efficient customer service
and accurate coverage information. If Vanderbilt Mortgage and Finance, Inc.
ISAOA/ATIMA is listed as
the Mortgagee, your insurance
company will automatically provide a copy of the renewal notice to our office.
Should you determine that Vanderbilt
is not the established Mortgagee, please contact your insurance
If you have questions and/or concerns regarding your escrow account, or if we may be of additional service, please do not hesitate to contact our office at the following telephone number and time(s):
8:30 a.m. to 8:00 p.m. (ET), Monday-Thursday
8:30 a.m. to 5:30 p.m. (ET), Friday