Can a Mortgage Company Change Your Payments?
Mortgage companies are bound to the agreed upon terms in your mortgage note. Arbitrary changes are not permitted. If certain circumstances exist, however, such as a shortage in your escrow balance, your mortgage company may need to make changes to your monthly payment. You can speak with your lender's customer service department to inquire about payment changes.
Other People Are Reading
-
Mortgage Payment
-
Mortgage payments are issued to lenders as a form of reimbursement for borrowed funds. Your mortgage payment could change according to the terms of your loan. If you have an adjustable-rate mortgage or an interest-only loan, your monthly payment may be subject to periodic changes. Your mortgage company should inform you about upcoming changes to your monthly payments.
Escrowed Items
-
Escrowed items are often included within a borrower's monthly mortgage payment. An escrow account reserves fractional monthly amounts toward fulfilling certain homeowner obligations, such as annual property taxes, school taxes or homeowner insurance premiums. Changes to a homeowner's property taxes often result in proportionate adjustments. For instance, if your property taxes are scheduled to increase $300 next year, your escrow requirement should also increase $300, as your new tax bill will get forwarded to your loan servicer. Your mortgage company will send a new escrow statement that likely reflects a $25 mortgage payment increase ($300 divided by 12 months equals $25).
-
Special Requests
-
Some mortgage companies may allow a borrower to submit a request for certain changes to his standard mortgage payment. Typically, mortgage payments are due on the first day of each month. However, some lenders may allow you to establish a more convenient payment due date, such as the 10th day of each month. You can request payment assistance from your mortgage company. Your mortgage lender might agree to modify your mortgage payment if you present a financial hardship.
Refinancing
-
Refinancing with your current lender could enable your mortgage company to change your payments. You might be able to secure a lower interest rate with minimal fees when refinancing with your present mortgage company.
Considerations
-
Removal of your escrow requirement will create a change to your mortgage payment. If you purchased your home with less than a 20 percent down payment, you may have a payment escrow on a conventional loan. You can speak with your lender about removing the escrow portion of your mortgage payment if your loan balance is less than 80 percent of the current value of your home. Your lender may require an appraisal to substantiate the value of your home.
-
References
Resources
- Photo Credit Digital Vision./Digital Vision/Getty Images
