FHA loan- first year of home insurance in escrow?
I am getting a FHA loan. The agent said that I need to pay a year in advance for the home insurance. Does that mean for the first year I do not need to make payments into escrow for home insurance?
Tags: Escrow, First, Home, insurance, Loan, year
2011/10/09 at 22:41:00
homeinsurance.awardspace.us – try this one. Got my home insurance from them. As I know they provide such a service.
2011/10/09 at 22:18:07
Your escrow account is an account held by your mortgage company. It is a tool used to work your insurance and taxes in with your mortgage payment monthly so that you don’t have to pay a huge sum annually. If your mortgage is “escrowed” then it means that your monthly payment includes taxes and insurance.
All that is required from you is your choice of insurance company. Shop around for the best annual rate, and give your mortgage company the information of the insurance company you choose. I recommend trying to bundle your auto and home insurance together, you will typically get a better rate that way.
Note: Unless you have at least 20% of the loan in cash, you will have to pay PMI (private mortggage insurance)
This is different than homeowners insurance and is pretty expensive, you want to get 20% paid off as soon as possible and drop it.
Have fun!
2011/10/09 at 21:43:19
no.
you pay policy in advance. so you buy policy now for next 12 months.
but you also pay 1/12 in each month so that in a year there is enough in escrow to pay annual premium that is due.