while that is true, it is also true that if you forgo the escrow option then some mortgage companies will charge you a fee for not letting them manage an escrow account. so bottom line, they will get there money either from your escrow or fee for not having an escrow.
You should get a tax statement well in advance of any payment due that shows what your current taxxes are and what your propose dtaxes are for the next year. Also, most counties have web sites (I know Harris county does) where you can look at your tax information online.
Shop around for a mortgage company that does not charge a waiver fee or a fee for not having an escrow account. The mortgage business is competitive enough where you should be able to find a reputable company that doesn't charge those fees.
But a lot of time, you really don't have a choice, because a lot of builders are tied to one mortgage company, and if you want their incentive, you have to use their mortgage company.
that's exactly right!! that is the situation i am in now. only financing 80% but i'm still considering doing escrow because the fees are huge if i don't. and my custom home builder has "deals" with about 3 mortgage companies and thus offer incentives that other mortgages companies(if i shopped) do not. so i think i'm going escrow. i guess it's worth losing the money to not have to worry about saving throughout the year. i have enough to worry about already.
You always have a choice. You simply have to decide if the incentives that a builder offers outweighs the fees their associated mortgage companies charge.
I believe most of the time, the incentive outweigh the fees. But I'm still going to choose to pay on my own, because you got the fee for only once, but you got to use escrow for years and years. I would recommend people to pay your property tax on your own. Just like insurance, just pay them all at once if you can.
Finance through the builder and then they will sell your mortgage to someone else. Use them to get those benefits and then when they sell it, if you don't like the new company or want to not escrow switch.
