We currently Escrow all loans on primary residences and are considering opting out of Escrow all together unless the property is in a Flood Zone. Can anyone give me some insight on the process of doing this and pros/cons of opting out of Escrowing? We will discuss at our next compliance meeting and I would love to know what other banks have done/are doing in order to help us make a decision. Also if anyone has a sample notice to send to customers or policy and procedures that would be helpful as well! Thanks in advance!
We have a borrower that has been dependent on force place insurance for the 3 years. This is an legacy 3 balloon note that we renew every three years. The loan is up for renewal for both the insurance and the loan renewal. Can we extend out the amortization to create payments that don't increase and also add escrow for the upcoming years force place insurance? This is a borrower occupied dwelling. So Reg Z applies. Is there anything else we want to consider if we extend the amortization and escrow for force place insurance?