“For this study, we were at just about 16,000 completed responses for this one, but we have 57% of that population who had an escrow payment increase over last year,” Gehrke told Mortgage Professional America. “Another 10% had a decrease. So, what you’re also seeing is that those decreases are probably a result of miscalculation, because insurance rates and taxes are increasing.
“Some of them have increased dramatically, so servicers, in those formulas that they use to try to calculate how much they have to take on a monthly basis, they can get out of whack fairly easily.”
Payment frustrations
Mortgage payments have been declining slightly, according to Redfin. The latest report showed the median mortgage payment at $2,679, its lowest level in nearly five months.
But the constant fluctuations, at a time when home budgets are tighter than ever, are a particular point of frustration for homeowners. Gehrke said servicers have to do a better job of getting that number right, and that’s not easy.
“The challenge there is really trying to fine-tune that process, and then communicate that back to the customer,” he said. “Two-thirds of customers are seeing their payment change every year. When we have 88% to 90% of the folks in this study who are on a fixed-rate mortgage, that is not a happy experience.”