Our mortgage was just purchased by a new servicing company and the tax escrow has a negative balance due to a recent increase in our city taxes. The service company did not call or send a notice showing a negative balance on the escrow account they simply raised the amount of the monthly payment by $36. The escrow is $200 to the negative and the balance was added to our loan meaning that we are paying $160 in interest on a balance we were not aware of. We always pay the negative balance without having an automatic modification by the company. Is this legal?
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This new mortgage servicing company raised the monthly payment without sending an escrow statement indicating a negative balance. The increase is based on an estimated negative balance, not an actual negative balance. We had no down payment.
Then they are simply doing what I was stating earlier. Estimating the tax increase. If they are wrong then you would get the credit in the following year. Typically taxes go up not down. If the loan is already issued then you have to escrow.