An escrow account is for paying property taxes and homeowner’s insurance. Lenders often require it. But, you might want to manage these payments yourself. A “Sample Letter To Remove Escrow Account From Mortgage” helps you request this change.
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Sample Letter To Remove Escrow Account From Mortgage
[Your Name]
[Your Address]
[Your City, State, Zip Code]
[Your Email Address]
[Your Phone Number]
[Date]
[Mortgage Company Name]
[Mortgage Company Address]
[Mortgage Company City, State, Zip Code]
**Subject: Request to Remove Escrow Account – Loan Number [Your Loan Number]**
Dear [Mortgage Company Contact Person or Department],
I am writing to request the removal of the escrow account associated with my mortgage, loan number [Your Loan Number], for the property located at [Your Property Address].
I understand that escrow accounts are typically used to pay property taxes and homeowners insurance premiums. I am now capable and willing to manage these payments independently and ensure they are made on time.
I believe I meet the requirements for escrow removal because [State your reasons, e.g., “I have a strong payment history,” “My loan-to-value ratio is below 80%,” or “I have owned the property for [Number] years”]. Please verify my eligibility based on the terms of my mortgage agreement and any applicable state or federal laws.
If any documentation is required from my end, such as proof of insurance or tax payment history, please let me know, and I will provide it promptly.
I would appreciate it if you could review my request and inform me of the process for removing the escrow account, including any fees or requirements.
Thank you for your time and consideration.
Sincerely,
[Your Signature]
[Your Typed Name]
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How to Write Letter To Remove Escrow Account From Mortgage
1. Subject Line: Clarity is Paramount
The subject line is your initial communiqué. It should be succinct and immediately convey the letter’s purpose. Don’t beat around the bush; be direct.
- Example: Request to Remove Escrow Account – [Your Loan Number]
- Steer clear of vague terminology. Precision mitigates potential delays.
2. Salutation: Formalities Still Matter
Even in the digital age, a proper salutation exhibits respect and professionalism. It sets a positive tone for your entreaty.
- Preferred: Dear [Mortgage Company Name],
- If you know the specific loan officer, addressing them directly is advantageous.
3. Introduction: State Your Purpose Audaciously
The introductory paragraph should unequivocally articulate your intent. Clearly state that you wish to discontinue your escrow account and detail the associated loan.
- “I am writing to formally request the removal of the escrow account associated with my mortgage, loan number [Your Loan Number], property address [Your Property Address].”
- Mention the date you closed on the mortgage if readily available.
4. Eligibility Criteria: Showcase Your Compliance
Mortgage companies typically have stringent criteria for escrow removal. Emphasize your adherence to these prerequisites. Demonstrate your fiscal responsibility.
- State your loan is current and you are not delinquent. Be explicit.
- Highlight any history of timely payments. A flawless record is your strongest asset.
- If applicable, mention your Loan-to-Value (LTV) ratio is below the threshold stipulated by your lender.
5. Justification: Lend Weight to Your Request
While eligibility is crucial, providing a rationale can further bolster your case. Articulate why you believe you are now capable of managing property taxes and insurance independently.
- “I am now capable of managing property taxes and homeowner’s insurance directly, ensuring timely payments and responsible fiscal stewardship.”
- Avoid disparaging remarks about the escrow service; remain professional and courteous. Focusing solely on your readiness is key.
6. Request for Confirmation: Proactive Follow-Up
Clearly request written confirmation of your escrow removal. This establishes a record and aids in preventing future misunderstandings. Lay the groundwork for transparent communication.
- “I kindly request written confirmation upon approval of this request, detailing the effective date of escrow account termination and any associated procedures.”
- Include your phone number and email address for ease of contact.
7. Closing: Courteous and Appreciative
End the letter with a professional closing. Express gratitude for their time and consideration. A gracious conclusion leaves a positive lasting impression.
- Acceptable Closings: “Sincerely,” “Respectfully,” or “Thank you for your time and consideration.”
- Always include your full name and signature (if sending a physical letter). If sending electronically, typing your full name is sufficient.
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Frequently Asked Questions: Removing Your Escrow Account
Many homeowners seek to manage their property taxes and insurance independently rather than through an escrow account. This FAQ addresses common inquiries regarding the process of removing an escrow account from a mortgage.
What are the typical requirements to remove an escrow account?
Lenders generally require sufficient equity in the home (typically 20% or more), a history of timely mortgage payments (usually 12 months), and adherence to all loan terms and conditions.
How do I request the removal of my escrow account?
Submit a written request to your mortgage servicer, clearly stating your intention to remove the escrow account. Include your loan number, property address, and contact information.
What happens after I submit my request?
The lender will review your request and assess your eligibility based on their internal guidelines and investor requirements. This may involve a property appraisal or credit check.
Is there a fee associated with removing an escrow account?
Some lenders may charge a fee to cover administrative costs or a new appraisal. Review your loan documents or contact your lender to confirm any applicable fees.
What if my request to remove the escrow account is denied?
If your request is denied, the lender will provide a reason. You can address the issues cited and reapply once you meet the eligibility criteria.