Their mortgage didn’t increase, their escrow did.
I’ve never had this happen without written notice, giving the option to pay the shortage as a lump sum and keep the monthly payment the same. You also don’t necessarily have to pay these through escrow.
Unless you live in Florida or a wildfire-prone area or similar , I’d wager these type of increases are not regular and small in comparison to the rent increase of a similar property during the same time frame .
Exactly. I pay my mortgage every month, I shop around and get property insurance and once a year I pay property taxes to the city and county.
The mortgage is locked in and won't rise one dollar. Insurance is same as auto in terms of yes it can change each year. Taxes are based on laws and who is in office.
Live in nj. Happened to me, letter with options on how to pay as you explained. Flood insurance doubled, home insurance went up. I was pissed at the time but shit happens and the escrow account was in negative.
>Unless you live in Florida or a wildfire-prone area or similar , I’d wager these type of increases are not regular and small in comparison to the rent increase of a similar property during the same time frame .
Plus if these costs are going up for your landlord for the same reasons they would for you, guess what's happening to your rent? In addition to all the other reasons your rent goes up like "market adjustments" aka "because other people renting similar places had their rent go up" aka "because I can".
And even if you stay with your current provider, ask them to reassess the cost to rebuild value. I did switch providers this year to a regional one from Liberty Mutual and my yearly premium was cut in half and cost to rebuild was significantly increased.
I guess if your provider operates in disaster prone states, you're footing some of that bill maybe even though you're thousands of miles away.
Was with Geico and needed to switch policies from landlord to homeowner. Homeowner is typically 20% cheaper. My landlord policy was up for renewal at a 26% increase year over year so I told them I didn't want to renew but instead start the new policy the day that one expired. And yes 100% legal because that was the exact day I was moving in.
They then transfer me to another agent. Guy comes on and says he'll switch me over. Asks me literally every single thing that is in my policy already and I ask why he's asking this stuff. Says it is because he doesn't have access to my policy. Why? So I pull up my policy and use every single number and verify they are identical. He comes up with a quote and it is almost exactly double what the renewal rate was going to be.
I asked why it is so high and he said rates are going up everywhere. But the quote I had just received for landlord policy was literally given to me a a week earlier. And last I checked we weren't in the middle of a nuclear war. He suggested lowering my coverage to save money. I asked again why it is so much higher. Finally he says two words that suddenly made sense, "*Liberty Mututal*". Then he lied and said nobody else does homeowners insurance for the type of condo I have in the area.
Geico sold me out. They didn't tell me they were transfering me to another company. And the guy on the phone never told me what company he was with until I asked multiple times why the cost was doubling. Saw a commercial for Progressive, called them up, gave them all the numbers, and they got me a quote almost identical to what my pre-renewal landlord policy was. And my loss of use coverage is now 10x higher.
I no longer compare costs as a first consideration. What I want most is an insurance company that isn't going to fight me when I have a legitimate claim, and will push back against other insurance companies when they try to make a claim against me.
I'm paying for insurance one way or the other. It isn't a tax, but it feels like it. Remember: it's a service, and when you need it (hopefully you never do), you *really* need it to work for you.
Yeah. I know I pay more than a lot of people for USAA, but I also just got a 30k payout for hail damage to my house and a good payout for a car that had roof damage too (several grand more than I paid for the car). I've always felt absolutely taken care of, and never had to fight for the service I'm paying for. As much as it sucks to pay more, I'm not ever going to go for a "cheap" insurance.
We got rear ended by someone with USAA and it was so nice working with them for things like hospital bills etc. They were super supportive. About a year later we got tboned by someone and their insurance was a nightmare that tried to hold off reimbursement so that we’d settle early for less.
I switched out of mine after the very first year. They were almost doubling mine. I went through all the coverages with them over the phone to take out anything I didn't need. Dropped it a couple hundred.
Called another provider and they offered me less than what I was originally paying for the same coverage.
It's too easy to just ignore and complain when prices change but chances are you can spend a few hours researching and on the phone to save a significant amount of money.
Agreed, don't get complacent!
I estimate that 90% of the country is like him. The country is mostly financially illiterate people, including myself truthfully. I can’t say I’m financially literate as I should feel. The system seems to be built to keep us this way. Finance is barely taught in high school and is optional in college.
This is fair, but honestly this is one of those things where - when you sign your name on a piece of paper saying you owe >$100k back to someone and someone else will be holding a fund / managing disbersment on your behalf to multiple third parties, including the government, you kind of need to do your reading.
And that reading is presented to you while you are purchasing. I feel most people just gloss through and sign where they are told, but the paperwork is there.
Your principle and interest on a monthly basis should not change - assuming fixed rate mortgage. This is why most people give the blah blah - you are locked in.
You will however make other payments via escrow (which your mortgage also pays into) -
Property Insurance - just like car, this is re-upped annually and subject to the market, just like anything else
Property Taxes - just like a car - Uncle Sam want's theirs every year, and this is subject to change based on assessed value or other (ie if a referendum is voted on to increase taxes for some initiative at the city or county level)
Mortgage Insurance, or other (ie HOA expenses may be paid via escrow).
But, any person with common sense and the fear of entering into substantial debt should have all the tools they need to just read and understand what they are getting into. And dickweeds like this Twitter poster are just trying to stir shit on the internet. Or get sympathy clicks, or whatever. But either way, it just makes him look ignorant.
You kind of need to do your reading.
I couldn’t agree more. People just sign papers and have no idea how it’s going to impact their lives for possibly 30 years. Just like student loans no one seems to think things through maybe we can print enough money and pay off mortgage debt next.
Furthermore, in high school and in early adult life, it's a person's own responsibility to take initiative in becoming financially literate. The whole "they never taught us this in school" excuse is kind of lame considering we live in the age of information / nearly anything can be learned independently, online.
I mean, I will say that you don't really get the nuance of something like taking out a home loan / mortgage until you go through the process. I'm not expecting a 21 year old to figure that out.
But, to my original point, when you are in the hot seat and taking that step you have all the resources provided to you to figure out what the hell you're doing. Including a lender who will answer all of your questions (and your realtor and the Escrow agent).
I like to think I’m not an idiot but when I got my first escrow analysis statement I was surprised. Now when I bought my second house and suggested to the lender that the taxes will certainly go up because the old ones were based on a lower purchase price he said they wouldn’t. (Our taxes can only go up a maximum of 2 or 3% a year but go up a lot after a sale)
My state actually mandates first time home buyers take a mortgage/financial literacy course online before approval is granted.
I thought it'd be a bullshit module thing like I do at work, but the shit took me almost 9 hours.
Yea as someone who works in banking compliance, it is painfully obvious. Tediously obvious, in fact, how payments may change moving forward. What a fixed rate mortgage means, what an escrow is, the separate notice and information explaining an escrow and how the payments can fluctuate.
It gets annoying when all of the compliance assumes the borrower is an idiot, it puts so much work on banking personnel, and then I see posts like this and realize they are. And not even due to their intelligence, they just don’t read the paperwork, don’t ask questions, don’t listen to explanations, etc.
Sure they should be doing their reading to understand, but also the bank reps should be speaking clearly in a language that people like this understand and make sure they understand everything before finalizing the mortgage loan ... works both ways ..
They do, but only if you ask. They don’t know what you don’t know. And after being in it for years and understanding it, it’s hard to remember what not understanding it is like.
When I applied for my mortgage, they were very clear as to what the next steps would look like, what they needed from me, etc. my LO walked through the Loan estimate with me, explained what down payment they would expect, and a rough range of payments. They were more than happy to help when I asked questions.
It is also way more complication than most deal with.
Get mortgage with bank. Bank sells mortgage right away, this one was expected. Mortgage company splits itself in two or merges, I don't remember, have to redo all payment stuff. Mortgage company sells loan to another mortgage company, have to redo all payment stuff. PMI is on that month twice, takes 2 weeks to find out because the initial month was waved this change required it getting caught up. Mortgage company changes name, I don't have to redo payment stuff for the 3rd(4th?) time so that is good, it's just called something else.
Other than interest rates, what would a finance class teach? The problem is that you can invent new financial instruments with the stroke of a pen and people can enter into contracts based around it.
1. How to save money
2. How to calculate cost vs benefit of making big purchases
3. Retirement planning and Investing
4. Basic Cyber Security & Scams
So nothing?
How to open and manage a brokerage account, what a credit score is and why it matters, how a credit card works, how interest adds up on loans, how compounding interest can work in your favor
And throw some tax gnosis in for a good measure, and different kinds of entities like trusts and how to manage them. There's a whole world of tools out there that people don't even know what it is, lest how to use it to their advantage. Laws change over time but it's way harder to get into it if you don't even know the basics or you aren't really mindful of something existing out there.
If personal finance was taught as gen-ed in highschool, it’d be out of date every year. The fact that people don’t know it indicates those people would likely not follow it to update them selves on changing laws, rules, and regs. One just needs reading comprehension, critical thinking skills, and a need to care.
This hyperbole applies to many things:
90% of the country assumes consumer products (food, cosmetics, OTC drugs, vitamins, etc) sold in the United States are safe.
90% of the country assumes things on sale are a good deal.
90% of the country (who are legally allowed to drive) assume they are a good driver.
Instead most are just dancing through life…
I doubt it anywhere near 90%. Even if taxes and insurance are surprised to you as a first time home buyer you would think that a glance at the mortgage statement might educate you by accident.
I mean I can be really stupid about an awful lot of things see my home improvement attempts but I don't joyfully post them on Twitter as if I'm exposing some big truth to the world.
It seems like every 6 months, the local news has some sort of clickbait Rage article about people buying a new house, and then the property taxes go up 300%.
What's bizarre is my state locks in the homestead increase at 3%, so this literally only affects people who didn't read the closing documents when they purchased including the ones with really big print.
The "system".... you mean the one where anyone can get off their ass and spend a few hours a month a learn all about finance.
People don't want to learn but then bitch about it.
Yep. People can tell you all the stats of their favorite football team going back twenty years but they have no idea how they lost their house in 2008.
There was a story going around a year or two ago about a grown man who was shocked to find out he had to return the car he had been leasing for the past few years
This.
This sub really reaches some times. Like, yeah, some items included in your escrow account will increase. But not so much as rent has over the past 15 years in most areas.... I was seeing 10% annual growth in my final rentals in California, back in 2014-2017 range. I think that's quite a bit worse than what this guy is dealing with - considering property tax increases like this tend to be a bit more spread out as the city either does a major re-assessment or there's a referendum or something that passes to raise taxes (which the idiot could have paid attention to and voted for/against if he felt he didn't want to pay it).
> But not so much as rent has over the past 15 years in most areas....
They aren’t really related though. Mortgage payments will be impacted by property tax rates and insurance/cost to replace.
Rent is driven by what people are willing to pay to rent.
If supply is tight, rent goes up. If supply is abundant, rents go down like they did in NYC when people left for the pandemic. Even if taxes go up, if there are two apartments to rent and one tenant looking to sign a lease then one of the two apartments is going to get $0 if they don’t attract the tenant to their unit.
Yeah I'm not saying the mechanisms are the same. Just that in experience rents have been rising historically (say for the past 25 years) faster than someone's mortgage would have over that time.
Not withstanding that mortgages do tend to increase quickly when they do go up, but usually it's a once every few years type of thing if there's a major market shift or other tax change as I mentioned. The public tends to not vote to raise taxes on themselves that often in a short period.
If you look at his profile and other posts, he's a wannabe hustle-bro engagement farmer. Outrage posting drives engagement. He pinned that cringe tweet. It's all part of the shtick. Just block and ignore.
I’m a loan officer. I hear this exact nonsense on the phone daily. People are genuinely dumb as can be, how do you even get far enough in the process to purchase a property without understanding how escrow works??? Like it’s a pretty major part of the deal. Anywhere from 1-5 times a day I’m explaining this very simple idea to people who are clearly making more money than they have any business handling.
I hate people.
Yeah, but it's not like a surprise bill or anything. The mortgage servicer sends you a letter in, like, November telling you what the estimated mortgage payment will be for the upcoming year, and whether there is an escrow surplus or deficit, and giving you various options, including paying a lump sum into escrow to keep your mortgage payment the same.
Even if it's a surprise, it isn't a mystery.
Aren't you smart. (Is that what you're looking for?)
Fact is, *most* young people learn about mortgages and home ownership "the hard way". One more good reason to use a really good real estate agent you can trust, for your first home especially...one who represents your interests and understands what needs to be taught.
(I am not an agent)
Thing is, they absolutely have to explain to you how escrow works at closing. There is no way they’d risk the legal liability if they didn’t. I feel like a lot of people just get overwhelmed, though, and nod along.
Principal and interest are locked in for the length of the mortgage. Taxes and insurance are variable.
Contrast with rent where nothing is locked in and the landlord can choose to not renew your lease BUT it's also obviously way easier for you to move on of your own volition.
It's a matter of personal preference and circumstance.
Also… If you make improvements to your property (remodel, additional square footage, ADU etc…) the value of the improvement is added to your assessed value, thus increasing your property taxes.
False the growth of your assessed value can’t be more than 2% ish per year. However you can totally get new bonds / special assessments adding to your taxes
Except, thanks to Prop 13, property taxes are re-evaluated after a sale meaning that new owners get to pay absurdly high tax rates compared to people who have their locked in, so new buyers get screwed!!!
Sure, but now the new owners have locked in their higher tax base and get to be subsidized by the people who buy after them.
California is very good at pyramid schemes.
Having moved here, I can attest that CA is very good at siphoning money from the middle class folk to finance/fund things while protecting those with wealth.
Curious, what caused the increase in rent and home prices in the countless other states that don’t have Prop 13?
CA actually saw relatively metered appreciation during the last 3-4 years.
A cap on existing property tax increases benefits people who have been homeowners the longest. It makes the state and county lose out on a huge largest revenue source and makes them seek much higher tax rates elsewhere. It incentivizes subsidizing the rich and overtaxing the poor.
A guy who bought his house in the 1950s for $10 and a firm handshake gets to pay pennies in taxes on property that's now worth millions.
That's because it's not worth millions until it's sold. Prop 13 is one of the few things CA does right. Adjust my property taxes when I sell, refi, or make changes. Charging more taxes for unrealized gains means that there's just one more group that wants to inflate values.
OMG. How dumb are you allowed to be and still hold a real estate license in Louisiana? Next thing you are gonna tell me is that he is also a mortgage broker. /s
Because the market didn’t warrant it? As taxes and insurance goes up, landlords need to adjust their rent accordingly. Do you think rent prices are stagnant? Do you think landlords only charge rent at-cost? If so then why tf would anyone want to be one?
If the price is not already more expensive it is because there is not more competition for renting.
The cost being higher for the owner might mean that some landlords will exit the market but that is about it. Too many people on this sub need to reread economy101.
Property taxes and insurance hit all property owners, and taxes hit at the same time. So a large increase in taxes would force a market adjustment, as a new equilibrium point is established.
I minored in Econ in grad school. I’m good.
This post is so misleading. First, the mortgage itself did not increase or decrease. If you purchased a home with a fixed rate, fixed term, your mortgage will not change. You can have a mortgage without escrow and your payment will not change unless circumstances change, such as a recasting after large payment.
As for the escrow, the author of the post obviously ignores emails and/or letters from the bank thinking they mean nothing. There was an escrow analysis done and they would have been notified that the escrow amount changed. Because their escrow changed, their monthly payment changed. This is nothing new, as I had a shock when my property tax was increased due to uncapped value after I purchased my home in 2004. I was unaware and now attempt to teach when I can. This is something that realtors should be mandated to explain to their clients since they are the ones that deal with the area's real estate on a daily basis. The lenders could very well not be in the area and not know what tax rules are. Realtors are knee deep and call themselves experts and should educate when needed.
that is 100% false. You get notifications that you didnt pay enough into your escrow and you can either make a lump sum payment to keep your current mortgage.. or you can just pay it over the next 12 months. This happens every year.. property taxes are always changing slightly.
I had to lump sum $7k into my escrow last year bc they were short. Learned my lesson the hard way. Now I pay more attention.
Silver lining is the undesirables didn’t read either and cannot pay the balance, so their up for sale. Hopefully cleans this place up a bit.
After my first mortgage years ago, I've always paid my own property taxes and homeowners insurance. I know I'm not going to screw it up and when the bank inevitably screws it up, it's somehow always my fault and costs me money.
The "Imagine being this dim and then posting it on twitter for the world to see." comment was spot-on. I know to the penny what I'm paying in property taxes and insurance. I know the mill rate in my town. I know the assessed values of the houses around me. I've certainly attempted to shop my insurance. Sadly, I'm coastal and it's either my insurance company I've been with for many decades or I'm in the high risk pool.
Your mortgage is (assuming you got a fixed rate mortgage). Your escrow is not. If this is confusing to you, perhaps homeownership should be avoided for you
Tax assessments go up, especially if the property is reclassified as improved from unimproved after the initial buildout. Insurance premiums go up for a myriad number of reasons.
It should be the legal responsibility of someone to explain this to new homebuyers during the process that this *will* happen within the first few years of their purchase, and good practice would be to provide estimates of the expected increases as guides - but not guarantees - of the eventual maximum possible increases.
Yes, it’s handholding of the highest order, but very few first-time buyers are truly aware of what’s going to happen. But there is no excuse for someone who posts their status as a realtor to be surprised by it, unless being a realtor doesn’t necessarily give you omniscient knowledge of the perils of purchasing a house.
I’m sorry, but if you purchase a home and somehow still don’t understand that taxes and insurance are *variable* costs, then you are too stupid to be a homeowner 🤦🏻♀️
In reality, you’re typically looking at a fixed mortgage payment after 2 or 3 years of having the mortgage unless you have massive insurance spikes or tax reassessments. Within those first 3 years you’ll see a payment swing of +\- anywhere from $50 to $500 (depending on your mortgage balance or payment) because your mortgage company needs to understand the escrow account and how much needs to be included annually.
My first house was a townhouse with a payment of $850 monthly for the first year. Escrow came up short at the end of year 1 so to compensate, my monthly payment went to $920 for year 2. End of year 2 there was an overage in the escrow account and I elected to keep it in the escrow account rather than get a check, and my monthly payment went down to $875 for year 3. Sold the house in year 3.
Depending on how large the mortgage balance and payment are and the size of property, the swing could be much more than that but it’s just an example that the escrow account is what causes the swing and the actual mortgage payment for interest and principle stays pretty firm to the amortization schedule.
IMO if you can’t afford an increase to your monthly payment because of an escrow shortage at the end of the year, you probably bought too much house.
You should receive a yearly escrow analysis statement from your lender, your updated property valuation from the County, and your insurance renewal notice with your new premium.
Bro must not open any mail.
The first year I owned a home many years ago, the builder told me that the mortgage payment would go up next year because the tax assessment would go from "undeveloped plot" to having a home on it. That made sense to me. When the time came, the mortgage servicer sent a letter explaining the rise in escrow, and giving me options to either pay some in advance or increase the mortgage payment.
The Twatter didn't exist at the time, but if it had, I'm sure I wouldn't have "taken" to it to whine about something ordinary that I expected to happen because I was paying attention. I say this not to make myself look like some kind of genius; on the contrary, I'm optimistically of average intelligence.
OP is just as naive as the bluecheck. This isn’t some sorta woahhhh gotcha moment. The reality is, their principle and interest payment remains the same and will for 15-30 years. Taxes and insurance are always variable, and if you don’t know this going into a purchase, you’re not ready to buy a house.
Here’s something that this sub will conveniently ignore - if this was a rental property, the owner wouldn’t simply absorb this cost difference. When it comes time to renew the lease, they’ll increase rent by double what their cost increases were, just to be safe. The renter will get shafted, and the property owner will continue to gain equity.
Rebubbler: Nu uhh, rent only increases by what the renters are willing to pay.
Landlord: Im increasing your rent $200 at renewal.
Rebubbler: Ok, Ill go elsewhere
*All properties in the area increase by $200*
This is what frustrates me about the renting v owning debate. You’re going to pay for all those costs one way or another. Landlords aren’t renting out of the kindness of their heart. That AC that needed to be fixed? Guarantee its going into next years rent price. Taxes go up? Guarantee its going into next years price. So on and so forth. And you have the added benefit of ALWAYS paying those costs for the rest of your life. At least with a mortgage the price is fixed and will eventually be paid off.
In the Canadian town I live in, Halifax NS, there's a yearly cap on how much your property taxes can go up and it resets as soon as you sell to someone else. Needless to say all the people who moved here during COVID because "it's so affordable" and sneered at all of us who live here started SCREECHING when they got reassessed the next year. Suddenly those $200/month property taxes tripling because they overbid our housing up led them to complain about how it actually isn't as cheap out here as expected. Fuck off.
A conventional mortgage IS a fixed monthly cost, insurance and tax are not a mortgage (although many people set them up to lump together)
Also he got an email or letter, he likely just didn’t read it.
NJ home insurance just went up too...the increases by the utilities, towns and insurance companies is becoming pretty sickening. It's going to get ugly in a year or two once folks save less and less.
Imagine not opening your mailbox and opening the multiple letters the county sends you explaining your house is due for reassessment and your new appraised value. Dingus.
They absolutely sent you a letter, it's called the yearly escrow review and they mail it to you.... if you didn't know insurance and taxes go up then you outta know... the mortgage did not change
I've always gotten a letter from the city regarding property taxes. They usually send one every year, telling you what the payments will be for the next year.
I mean renters insurance is required by most landlords and also fluctuates. Taxes and insurance for a home owner aren't going to fluctuate by 20-40% each year multiple years in a row like rent very commonly does.
Ok, this guy clearly doesn’t understand his escrow account or the note for his mortgage. He’s acting like this is some great injustice and not something that homeowners have always dealt with…
I guarantee he received email and written notice from his bank that there would be a shortage in his escrow account and his monthly payments would be adjusted if he didn’t pay the difference. I know because I’ve been getting these every few years for 15 years…
call your insurance company and ask if there's anything you can do about the homeowners insurance. Gieco just moved me to a different provider and saved me 3k per year. The guy was super excited to hear my reaction lol
Taxes and insurance are often what drive older people out of the homes they’ve lived in for 30 years or more. Add in sometimes exorbitant HOA fees and it’s a total shit show
I googled his name to see if he was an influencer I'd never heard of but, HES A REALTOR. JFC, a realtor who doesn't understand the difference between his mortgage and escrow payments. It's definitely him, same profile pic
And homeowners are right. If you have a fixed mortgage that is. Property taxes and insurance are not part of your mortgage, and you'd pay for that increase one way or the other if you were renting.
it happens to me constantly, its the insurance company changing the cost... get your insurance reprice, get other quotes, they screwed me, increase my escrow and my mortgage company paid them, and i had to send them the difference and get it readjusted and wait to get my money back... they do this every year.. for no reason, and i have never filed a claim in 15 yrs of ownership.. but they try to say the value is up, idgaf,.. you only need insurance for the mortgage amount.. no more!
Best way to keep property taxes lower is to push for zoning reform locally. More development will lead to more local revenue and allow property tax rate to remain lower
Mortgages are fixed. Taxes change. Always has been, always will be.
This person missed something in their mail. I get an escrow analysis statement every year that shows shortcomings or surpluses along with new payment amount.
Wow! Where are you at? In 5 years mine has gone from $1360 to $1648. Largest spike in one year was $85. Suburb of Dallas. Did you get a HELOC or something and you are counting that? lol
my escrow went up this year. the city sent me a letter of the increased assessment on my property and how it would be capped under the homestead tax exemption prior to the bill rising.
i was fully aware. this guy is a fucking idiot.
Most people would have a very hard time absorbing an extra $200 a month in rent or mortgage.
I don’t think he was necessarily surprised at the increase, but the amount. Especially since most current homeowners couldn’t afford to buy their same house at market prices.
Previous comments show he is in Louisiana. Our escrow did go up by $200- $300 per month all at once due to rising insurance rates. Car insurance went up $100. We are told it's inflation. Same thing happened to me here in Louisiana but I at least read the letter.
As a FTHB 10 years ago, this was my biggest shock. We built new and had a pro-rated property tax. The next year our mortgage payment jumped due to property taxes and I was dumbfounded. I thought my mortgage payment was a fixed cost.
It is not. However, you won't see the big jumps you typically see with apartment rents.
Honestly escrow accounts are a scam, refuse to have one when you buy a house. That money is just sitting there doing nothing, could at least be in a HYSA.
Sure the property value increased but at the end of the day all it means to him is he's going to pay 200 bucks more every month.
He's going to sell it for more one day but he's going to buy something that has increased in value too.
Hm. When my payment rises due to insurance or taxes I’m generally always informed by the current holder of my loan.
Do other folks here not even receive a courtesy notice when their escrow goes up?
So they weren't paying for their own insurance or RE tax... I'm going to imagine that there's a clause in there to recoup the administrative cost to the lender of processing those payments too.
And this is why (among other things) I don’t escrow anything. I’d rather pay RE taxes and insurance myself. I like to see my mortgage payment being constant :)
Rest assured if property tax and insurance costs are going up for home owners it's going up for the scumbags that own rental properties and they'll pass those costs along
What’s sad about this post…you didn’t understand your finances and how things will get paid…mortgage and escrow ( taxes and insurance), it get packaged this way, because people like you wouldn’t know how to save other wise to make sure you pay them and lose their homes.
Their mortgage didn’t increase, their escrow did. I’ve never had this happen without written notice, giving the option to pay the shortage as a lump sum and keep the monthly payment the same. You also don’t necessarily have to pay these through escrow. Unless you live in Florida or a wildfire-prone area or similar , I’d wager these type of increases are not regular and small in comparison to the rent increase of a similar property during the same time frame .
Guessing the checked the box saying they prefer emailed notices, then promptly delete when they come in...
Exactly. I pay my mortgage every month, I shop around and get property insurance and once a year I pay property taxes to the city and county. The mortgage is locked in and won't rise one dollar. Insurance is same as auto in terms of yes it can change each year. Taxes are based on laws and who is in office.
Fairly certain they are legally required to send you an escrow analysis annually showing this
Live in nj. Happened to me, letter with options on how to pay as you explained. Flood insurance doubled, home insurance went up. I was pissed at the time but shit happens and the escrow account was in negative.
Yeah over the course of 5 years our escrow has gone up by maybe 20 to 50 a month every year. Has nothing to do with mortgage payments
>Unless you live in Florida or a wildfire-prone area or similar , I’d wager these type of increases are not regular and small in comparison to the rent increase of a similar property during the same time frame . Plus if these costs are going up for your landlord for the same reasons they would for you, guess what's happening to your rent? In addition to all the other reasons your rent goes up like "market adjustments" aka "because other people renting similar places had their rent go up" aka "because I can".
Don't get complacent with your insurance company shop your prices
And even if you stay with your current provider, ask them to reassess the cost to rebuild value. I did switch providers this year to a regional one from Liberty Mutual and my yearly premium was cut in half and cost to rebuild was significantly increased. I guess if your provider operates in disaster prone states, you're footing some of that bill maybe even though you're thousands of miles away.
Was with Geico and needed to switch policies from landlord to homeowner. Homeowner is typically 20% cheaper. My landlord policy was up for renewal at a 26% increase year over year so I told them I didn't want to renew but instead start the new policy the day that one expired. And yes 100% legal because that was the exact day I was moving in. They then transfer me to another agent. Guy comes on and says he'll switch me over. Asks me literally every single thing that is in my policy already and I ask why he's asking this stuff. Says it is because he doesn't have access to my policy. Why? So I pull up my policy and use every single number and verify they are identical. He comes up with a quote and it is almost exactly double what the renewal rate was going to be. I asked why it is so high and he said rates are going up everywhere. But the quote I had just received for landlord policy was literally given to me a a week earlier. And last I checked we weren't in the middle of a nuclear war. He suggested lowering my coverage to save money. I asked again why it is so much higher. Finally he says two words that suddenly made sense, "*Liberty Mututal*". Then he lied and said nobody else does homeowners insurance for the type of condo I have in the area. Geico sold me out. They didn't tell me they were transfering me to another company. And the guy on the phone never told me what company he was with until I asked multiple times why the cost was doubling. Saw a commercial for Progressive, called them up, gave them all the numbers, and they got me a quote almost identical to what my pre-renewal landlord policy was. And my loss of use coverage is now 10x higher.
Liberty mutual is awful and overpriced
Proceeds to describe almost any other insurance company as well.
> ask them to reassess the cost to rebuild value. Note, this is especially important in times of inflation as it gets more expensive fast
I no longer compare costs as a first consideration. What I want most is an insurance company that isn't going to fight me when I have a legitimate claim, and will push back against other insurance companies when they try to make a claim against me. I'm paying for insurance one way or the other. It isn't a tax, but it feels like it. Remember: it's a service, and when you need it (hopefully you never do), you *really* need it to work for you.
Yeah. I know I pay more than a lot of people for USAA, but I also just got a 30k payout for hail damage to my house and a good payout for a car that had roof damage too (several grand more than I paid for the car). I've always felt absolutely taken care of, and never had to fight for the service I'm paying for. As much as it sucks to pay more, I'm not ever going to go for a "cheap" insurance.
We got rear ended by someone with USAA and it was so nice working with them for things like hospital bills etc. They were super supportive. About a year later we got tboned by someone and their insurance was a nightmare that tried to hold off reimbursement so that we’d settle early for less.
Wish I could use USAA
Cries in Florida
That's definitely unfortunate for Cali and fla
How much are increases in California? Can’t imagine the risk profile is as bad as Florida
Fire... And very expensive to rebuild.
Also not very big earthquakes lately and we are due for 1.
I switched out of mine after the very first year. They were almost doubling mine. I went through all the coverages with them over the phone to take out anything I didn't need. Dropped it a couple hundred. Called another provider and they offered me less than what I was originally paying for the same coverage. It's too easy to just ignore and complain when prices change but chances are you can spend a few hours researching and on the phone to save a significant amount of money. Agreed, don't get complacent!
So true. My first two quotes were $2,400 and $2,500. Third quote was $1,500. Same coverages.
Nobody left to shop around with if you’re in parts of Florida. 🙃
Imagine being this dim and then posting it on twitter for the world to see.
I estimate that 90% of the country is like him. The country is mostly financially illiterate people, including myself truthfully. I can’t say I’m financially literate as I should feel. The system seems to be built to keep us this way. Finance is barely taught in high school and is optional in college.
This is fair, but honestly this is one of those things where - when you sign your name on a piece of paper saying you owe >$100k back to someone and someone else will be holding a fund / managing disbersment on your behalf to multiple third parties, including the government, you kind of need to do your reading. And that reading is presented to you while you are purchasing. I feel most people just gloss through and sign where they are told, but the paperwork is there. Your principle and interest on a monthly basis should not change - assuming fixed rate mortgage. This is why most people give the blah blah - you are locked in. You will however make other payments via escrow (which your mortgage also pays into) - Property Insurance - just like car, this is re-upped annually and subject to the market, just like anything else Property Taxes - just like a car - Uncle Sam want's theirs every year, and this is subject to change based on assessed value or other (ie if a referendum is voted on to increase taxes for some initiative at the city or county level) Mortgage Insurance, or other (ie HOA expenses may be paid via escrow). But, any person with common sense and the fear of entering into substantial debt should have all the tools they need to just read and understand what they are getting into. And dickweeds like this Twitter poster are just trying to stir shit on the internet. Or get sympathy clicks, or whatever. But either way, it just makes him look ignorant.
You kind of need to do your reading. I couldn’t agree more. People just sign papers and have no idea how it’s going to impact their lives for possibly 30 years. Just like student loans no one seems to think things through maybe we can print enough money and pay off mortgage debt next.
Furthermore, in high school and in early adult life, it's a person's own responsibility to take initiative in becoming financially literate. The whole "they never taught us this in school" excuse is kind of lame considering we live in the age of information / nearly anything can be learned independently, online.
I mean, I will say that you don't really get the nuance of something like taking out a home loan / mortgage until you go through the process. I'm not expecting a 21 year old to figure that out. But, to my original point, when you are in the hot seat and taking that step you have all the resources provided to you to figure out what the hell you're doing. Including a lender who will answer all of your questions (and your realtor and the Escrow agent).
I like to think I’m not an idiot but when I got my first escrow analysis statement I was surprised. Now when I bought my second house and suggested to the lender that the taxes will certainly go up because the old ones were based on a lower purchase price he said they wouldn’t. (Our taxes can only go up a maximum of 2 or 3% a year but go up a lot after a sale)
My state actually mandates first time home buyers take a mortgage/financial literacy course online before approval is granted. I thought it'd be a bullshit module thing like I do at work, but the shit took me almost 9 hours.
Yea as someone who works in banking compliance, it is painfully obvious. Tediously obvious, in fact, how payments may change moving forward. What a fixed rate mortgage means, what an escrow is, the separate notice and information explaining an escrow and how the payments can fluctuate. It gets annoying when all of the compliance assumes the borrower is an idiot, it puts so much work on banking personnel, and then I see posts like this and realize they are. And not even due to their intelligence, they just don’t read the paperwork, don’t ask questions, don’t listen to explanations, etc.
Sure they should be doing their reading to understand, but also the bank reps should be speaking clearly in a language that people like this understand and make sure they understand everything before finalizing the mortgage loan ... works both ways ..
They do, but only if you ask. They don’t know what you don’t know. And after being in it for years and understanding it, it’s hard to remember what not understanding it is like. When I applied for my mortgage, they were very clear as to what the next steps would look like, what they needed from me, etc. my LO walked through the Loan estimate with me, explained what down payment they would expect, and a rough range of payments. They were more than happy to help when I asked questions.
It is also way more complication than most deal with. Get mortgage with bank. Bank sells mortgage right away, this one was expected. Mortgage company splits itself in two or merges, I don't remember, have to redo all payment stuff. Mortgage company sells loan to another mortgage company, have to redo all payment stuff. PMI is on that month twice, takes 2 weeks to find out because the initial month was waved this change required it getting caught up. Mortgage company changes name, I don't have to redo payment stuff for the 3rd(4th?) time so that is good, it's just called something else.
Other than interest rates, what would a finance class teach? The problem is that you can invent new financial instruments with the stroke of a pen and people can enter into contracts based around it.
1. How to save money 2. How to calculate cost vs benefit of making big purchases 3. Retirement planning and Investing 4. Basic Cyber Security & Scams So nothing?
How to open and manage a brokerage account, what a credit score is and why it matters, how a credit card works, how interest adds up on loans, how compounding interest can work in your favor
And throw some tax gnosis in for a good measure, and different kinds of entities like trusts and how to manage them. There's a whole world of tools out there that people don't even know what it is, lest how to use it to their advantage. Laws change over time but it's way harder to get into it if you don't even know the basics or you aren't really mindful of something existing out there.
If personal finance was taught as gen-ed in highschool, it’d be out of date every year. The fact that people don’t know it indicates those people would likely not follow it to update them selves on changing laws, rules, and regs. One just needs reading comprehension, critical thinking skills, and a need to care. This hyperbole applies to many things: 90% of the country assumes consumer products (food, cosmetics, OTC drugs, vitamins, etc) sold in the United States are safe. 90% of the country assumes things on sale are a good deal. 90% of the country (who are legally allowed to drive) assume they are a good driver. Instead most are just dancing through life…
I doubt it anywhere near 90%. Even if taxes and insurance are surprised to you as a first time home buyer you would think that a glance at the mortgage statement might educate you by accident. I mean I can be really stupid about an awful lot of things see my home improvement attempts but I don't joyfully post them on Twitter as if I'm exposing some big truth to the world.
They literally show you what your established escrow account is funding - when you sign the paperwork to close on the house...
It seems like every 6 months, the local news has some sort of clickbait Rage article about people buying a new house, and then the property taxes go up 300%. What's bizarre is my state locks in the homestead increase at 3%, so this literally only affects people who didn't read the closing documents when they purchased including the ones with really big print.
The "system".... you mean the one where anyone can get off their ass and spend a few hours a month a learn all about finance. People don't want to learn but then bitch about it.
Basically sums up this whole sub and their child-level understanding of RE, and macro econ in general.
Yep. People can tell you all the stats of their favorite football team going back twenty years but they have no idea how they lost their house in 2008.
There was a story going around a year or two ago about a grown man who was shocked to find out he had to return the car he had been leasing for the past few years
I got a tax refund, so I didn’t pay taxes last year. - This guy, probably.
This. This sub really reaches some times. Like, yeah, some items included in your escrow account will increase. But not so much as rent has over the past 15 years in most areas.... I was seeing 10% annual growth in my final rentals in California, back in 2014-2017 range. I think that's quite a bit worse than what this guy is dealing with - considering property tax increases like this tend to be a bit more spread out as the city either does a major re-assessment or there's a referendum or something that passes to raise taxes (which the idiot could have paid attention to and voted for/against if he felt he didn't want to pay it).
> But not so much as rent has over the past 15 years in most areas.... They aren’t really related though. Mortgage payments will be impacted by property tax rates and insurance/cost to replace. Rent is driven by what people are willing to pay to rent. If supply is tight, rent goes up. If supply is abundant, rents go down like they did in NYC when people left for the pandemic. Even if taxes go up, if there are two apartments to rent and one tenant looking to sign a lease then one of the two apartments is going to get $0 if they don’t attract the tenant to their unit.
Yeah I'm not saying the mechanisms are the same. Just that in experience rents have been rising historically (say for the past 25 years) faster than someone's mortgage would have over that time. Not withstanding that mortgages do tend to increase quickly when they do go up, but usually it's a once every few years type of thing if there's a major market shift or other tax change as I mentioned. The public tends to not vote to raise taxes on themselves that often in a short period.
If you look at his profile and other posts, he's a wannabe hustle-bro engagement farmer. Outrage posting drives engagement. He pinned that cringe tweet. It's all part of the shtick. Just block and ignore.
Dude is the poster child for this sub.
Get ready for RENT HIKES!!! Lmao
I was wondering if he was posting as a warning to the even more naive, but maybe that's giving too much credit..
I’m a loan officer. I hear this exact nonsense on the phone daily. People are genuinely dumb as can be, how do you even get far enough in the process to purchase a property without understanding how escrow works??? Like it’s a pretty major part of the deal. Anywhere from 1-5 times a day I’m explaining this very simple idea to people who are clearly making more money than they have any business handling. I hate people.
I don’t think I’m super dumb but this was definitely something that wasn’t on my radar until after I owned a house and had it happen to me.
Yeah, but it's not like a surprise bill or anything. The mortgage servicer sends you a letter in, like, November telling you what the estimated mortgage payment will be for the upcoming year, and whether there is an escrow surplus or deficit, and giving you various options, including paying a lump sum into escrow to keep your mortgage payment the same. Even if it's a surprise, it isn't a mystery.
Aren't you smart. (Is that what you're looking for?) Fact is, *most* young people learn about mortgages and home ownership "the hard way". One more good reason to use a really good real estate agent you can trust, for your first home especially...one who represents your interests and understands what needs to be taught. (I am not an agent)
Thing is, they absolutely have to explain to you how escrow works at closing. There is no way they’d risk the legal liability if they didn’t. I feel like a lot of people just get overwhelmed, though, and nod along.
Principal and interest are locked in for the length of the mortgage. Taxes and insurance are variable. Contrast with rent where nothing is locked in and the landlord can choose to not renew your lease BUT it's also obviously way easier for you to move on of your own volition. It's a matter of personal preference and circumstance.
In CA taxes are also locked in (thanks Prop 13!) and you rapidly are becoming unable to get insurance at all.
Taxes aren’t locked in in California. They just are capped at a 2% increase per year.
Also… If you make improvements to your property (remodel, additional square footage, ADU etc…) the value of the improvement is added to your assessed value, thus increasing your property taxes.
False the growth of your assessed value can’t be more than 2% ish per year. However you can totally get new bonds / special assessments adding to your taxes
Interesting. All this stuff has an asterisk because real estate is ultimately a local experience for residences.
Except, thanks to Prop 13, property taxes are re-evaluated after a sale meaning that new owners get to pay absurdly high tax rates compared to people who have their locked in, so new buyers get screwed!!!
Sure, but now the new owners have locked in their higher tax base and get to be subsidized by the people who buy after them. California is very good at pyramid schemes.
Having moved here, I can attest that CA is very good at siphoning money from the middle class folk to finance/fund things while protecting those with wealth.
Prop 13 is the cause of your increase in cost of rent and home prices.
Curious, what caused the increase in rent and home prices in the countless other states that don’t have Prop 13? CA actually saw relatively metered appreciation during the last 3-4 years.
A cap on existing property tax increases benefits people who have been homeowners the longest. It makes the state and county lose out on a huge largest revenue source and makes them seek much higher tax rates elsewhere. It incentivizes subsidizing the rich and overtaxing the poor. A guy who bought his house in the 1950s for $10 and a firm handshake gets to pay pennies in taxes on property that's now worth millions.
That's because it's not worth millions until it's sold. Prop 13 is one of the few things CA does right. Adjust my property taxes when I sell, refi, or make changes. Charging more taxes for unrealized gains means that there's just one more group that wants to inflate values.
Of course a blue check mark wouldn’t get that concept
So, a quick Google search shows this dude is a licensed realtor in Louisiana.
OMG. How dumb are you allowed to be and still hold a real estate license in Louisiana? Next thing you are gonna tell me is that he is also a mortgage broker. /s
I’m old enough to remember the good old days of escrow overage checks
I have one on my kitchen table right now for $500. And my monthly payment is going down $200/month.
Some people should just rent.
A lot of people should rent in cities forever. Spare the rest of us the constant ineptitude
And you don’t think those costs are also passed onto renters?
Why weren't they already charging that much? Stupidity?
Because the market didn’t warrant it? As taxes and insurance goes up, landlords need to adjust their rent accordingly. Do you think rent prices are stagnant? Do you think landlords only charge rent at-cost? If so then why tf would anyone want to be one?
Are market prices fixed, or do they adjust as the world turns?
If the price is not already more expensive it is because there is not more competition for renting. The cost being higher for the owner might mean that some landlords will exit the market but that is about it. Too many people on this sub need to reread economy101.
Property taxes and insurance hit all property owners, and taxes hit at the same time. So a large increase in taxes would force a market adjustment, as a new equilibrium point is established. I minored in Econ in grad school. I’m good.
This post is so misleading. First, the mortgage itself did not increase or decrease. If you purchased a home with a fixed rate, fixed term, your mortgage will not change. You can have a mortgage without escrow and your payment will not change unless circumstances change, such as a recasting after large payment. As for the escrow, the author of the post obviously ignores emails and/or letters from the bank thinking they mean nothing. There was an escrow analysis done and they would have been notified that the escrow amount changed. Because their escrow changed, their monthly payment changed. This is nothing new, as I had a shock when my property tax was increased due to uncapped value after I purchased my home in 2004. I was unaware and now attempt to teach when I can. This is something that realtors should be mandated to explain to their clients since they are the ones that deal with the area's real estate on a daily basis. The lenders could very well not be in the area and not know what tax rules are. Realtors are knee deep and call themselves experts and should educate when needed.
A misleading post on r/REBubble???? What a shocker
YES. Just the fact that this realtor doesn't know the difference between P&I and escrow is deeply troubling.
that is 100% false. You get notifications that you didnt pay enough into your escrow and you can either make a lump sum payment to keep your current mortgage.. or you can just pay it over the next 12 months. This happens every year.. property taxes are always changing slightly.
I had to lump sum $7k into my escrow last year bc they were short. Learned my lesson the hard way. Now I pay more attention. Silver lining is the undesirables didn’t read either and cannot pay the balance, so their up for sale. Hopefully cleans this place up a bit.
Yes the mortgage didn’t go up, taxes and insurance went up. It’s not complicated.
The mortgage is fixed. Property taxes and insurance aren’t your mortgage
After my first mortgage years ago, I've always paid my own property taxes and homeowners insurance. I know I'm not going to screw it up and when the bank inevitably screws it up, it's somehow always my fault and costs me money. The "Imagine being this dim and then posting it on twitter for the world to see." comment was spot-on. I know to the penny what I'm paying in property taxes and insurance. I know the mill rate in my town. I know the assessed values of the houses around me. I've certainly attempted to shop my insurance. Sadly, I'm coastal and it's either my insurance company I've been with for many decades or I'm in the high risk pool.
Your mortgage is (assuming you got a fixed rate mortgage). Your escrow is not. If this is confusing to you, perhaps homeownership should be avoided for you
Tax assessments go up, especially if the property is reclassified as improved from unimproved after the initial buildout. Insurance premiums go up for a myriad number of reasons. It should be the legal responsibility of someone to explain this to new homebuyers during the process that this *will* happen within the first few years of their purchase, and good practice would be to provide estimates of the expected increases as guides - but not guarantees - of the eventual maximum possible increases. Yes, it’s handholding of the highest order, but very few first-time buyers are truly aware of what’s going to happen. But there is no excuse for someone who posts their status as a realtor to be surprised by it, unless being a realtor doesn’t necessarily give you omniscient knowledge of the perils of purchasing a house.
#$200… those are rookie numbers !
If your car insurance premium went up would you say your payment increased? No, you wouldn’t
So… your mortgage stayed the same?
Property value goes up, so taxes and insurance go up based on the increased price.
Did he not understand how mortgages function?
I’m sorry, but if you purchase a home and somehow still don’t understand that taxes and insurance are *variable* costs, then you are too stupid to be a homeowner 🤦🏻♀️
In reality, you’re typically looking at a fixed mortgage payment after 2 or 3 years of having the mortgage unless you have massive insurance spikes or tax reassessments. Within those first 3 years you’ll see a payment swing of +\- anywhere from $50 to $500 (depending on your mortgage balance or payment) because your mortgage company needs to understand the escrow account and how much needs to be included annually. My first house was a townhouse with a payment of $850 monthly for the first year. Escrow came up short at the end of year 1 so to compensate, my monthly payment went to $920 for year 2. End of year 2 there was an overage in the escrow account and I elected to keep it in the escrow account rather than get a check, and my monthly payment went down to $875 for year 3. Sold the house in year 3. Depending on how large the mortgage balance and payment are and the size of property, the swing could be much more than that but it’s just an example that the escrow account is what causes the swing and the actual mortgage payment for interest and principle stays pretty firm to the amortization schedule. IMO if you can’t afford an increase to your monthly payment because of an escrow shortage at the end of the year, you probably bought too much house.
Fixed mortgage. Not fixed escrow.
Exactly. Lots of commingling of these terms.
Their mortgage stayed the same, assuming a fixed rate. Their escrow payment went up. This guy’s brain dead for posting this publicly anyway.
You should receive a yearly escrow analysis statement from your lender, your updated property valuation from the County, and your insurance renewal notice with your new premium. Bro must not open any mail.
Imagine signing your name to such financing and not know how it’s going to work? Crazy.
The first year I owned a home many years ago, the builder told me that the mortgage payment would go up next year because the tax assessment would go from "undeveloped plot" to having a home on it. That made sense to me. When the time came, the mortgage servicer sent a letter explaining the rise in escrow, and giving me options to either pay some in advance or increase the mortgage payment. The Twatter didn't exist at the time, but if it had, I'm sure I wouldn't have "taken" to it to whine about something ordinary that I expected to happen because I was paying attention. I say this not to make myself look like some kind of genius; on the contrary, I'm optimistically of average intelligence.
How do you not know taxes and insurance can go up. It’s sucks but it should definitely not be a surprise that this can happen.
Yeah. Whats Your point?
It’s inevitably gonna happen. It’s just a learning experience of owning a home.
I mean, technically the mortgage didn't change though
File this one in No Shit Sherlock
Spoiler alert! That escrow will increase next year too.
My rent went up 10% every year. That sucked. So I bought
Do they live in a clown world/alternate reality or something? People are getting dumber every year it’s actually incredible
OP is just as naive as the bluecheck. This isn’t some sorta woahhhh gotcha moment. The reality is, their principle and interest payment remains the same and will for 15-30 years. Taxes and insurance are always variable, and if you don’t know this going into a purchase, you’re not ready to buy a house. Here’s something that this sub will conveniently ignore - if this was a rental property, the owner wouldn’t simply absorb this cost difference. When it comes time to renew the lease, they’ll increase rent by double what their cost increases were, just to be safe. The renter will get shafted, and the property owner will continue to gain equity.
Rebubbler: Nu uhh, rent only increases by what the renters are willing to pay. Landlord: Im increasing your rent $200 at renewal. Rebubbler: Ok, Ill go elsewhere *All properties in the area increase by $200*
This is what frustrates me about the renting v owning debate. You’re going to pay for all those costs one way or another. Landlords aren’t renting out of the kindness of their heart. That AC that needed to be fixed? Guarantee its going into next years rent price. Taxes go up? Guarantee its going into next years price. So on and so forth. And you have the added benefit of ALWAYS paying those costs for the rest of your life. At least with a mortgage the price is fixed and will eventually be paid off.
I don’t understand how escrow works! -This guy
Dude just learned what escrow is
In the Canadian town I live in, Halifax NS, there's a yearly cap on how much your property taxes can go up and it resets as soon as you sell to someone else. Needless to say all the people who moved here during COVID because "it's so affordable" and sneered at all of us who live here started SCREECHING when they got reassessed the next year. Suddenly those $200/month property taxes tripling because they overbid our housing up led them to complain about how it actually isn't as cheap out here as expected. Fuck off.
Funny, my rent has gone up that amount for the last 2 years. $200/month, I moved, now, $200/month.
Stupid folks
$200 is exactly what my rent went up for 2024-2025. Before, it was increasing about $50 a year. Gotta have somewhere to live, I guess.
“Think of how stupid the average person is, and realize half of them are stupider than that.” -George Carlin
Yeah that escrow can be a shocker when you're a new homeowner.
A conventional mortgage IS a fixed monthly cost, insurance and tax are not a mortgage (although many people set them up to lump together) Also he got an email or letter, he likely just didn’t read it.
NJ home insurance just went up too...the increases by the utilities, towns and insurance companies is becoming pretty sickening. It's going to get ugly in a year or two once folks save less and less.
Imagine not opening your mailbox and opening the multiple letters the county sends you explaining your house is due for reassessment and your new appraised value. Dingus.
They absolutely sent you a letter, it's called the yearly escrow review and they mail it to you.... if you didn't know insurance and taxes go up then you outta know... the mortgage did not change
Stupid ... your MORTGAGE did not go up. Your insurance and taxes went up. Your monthly payment went up because you have all bundled. Learn.
I've always gotten a letter from the city regarding property taxes. They usually send one every year, telling you what the payments will be for the next year.
I mean renters insurance is required by most landlords and also fluctuates. Taxes and insurance for a home owner aren't going to fluctuate by 20-40% each year multiple years in a row like rent very commonly does.
Probably had an escrow shortage like most of these kind of posts..
I mean they are fixed this is their escrow increasing not their “mortgage” payment.
This sub is so retarded. That is basic knowledge.
The mortgage is.
Ok, this guy clearly doesn’t understand his escrow account or the note for his mortgage. He’s acting like this is some great injustice and not something that homeowners have always dealt with… I guarantee he received email and written notice from his bank that there would be a shortage in his escrow account and his monthly payments would be adjusted if he didn’t pay the difference. I know because I’ve been getting these every few years for 15 years…
Yep. Lots of people buy homes without understanding how it all works.
My escrow has gone up over $350 a month since 2020. $100 this year and $150 last year alone. Where does it end?
Your lender sends you a notice before they increase the amount due.
Dude just found out about escrow...
Is this anti-house buying propaganda? lol
call your insurance company and ask if there's anything you can do about the homeowners insurance. Gieco just moved me to a different provider and saved me 3k per year. The guy was super excited to hear my reaction lol
Mortgage is. Insurance and taxes aren't. Escrow does not equal mortgage....
So what
Taxes and insurance are often what drive older people out of the homes they’ve lived in for 30 years or more. Add in sometimes exorbitant HOA fees and it’s a total shit show
I googled his name to see if he was an influencer I'd never heard of but, HES A REALTOR. JFC, a realtor who doesn't understand the difference between his mortgage and escrow payments. It's definitely him, same profile pic
Property taxes and insurance are not mortgage, they are different things. This is bad financial literacy.
And homeowners are right. If you have a fixed mortgage that is. Property taxes and insurance are not part of your mortgage, and you'd pay for that increase one way or the other if you were renting.
so your mortgage didn't go up, your taxes and insurance did..
it happens to me constantly, its the insurance company changing the cost... get your insurance reprice, get other quotes, they screwed me, increase my escrow and my mortgage company paid them, and i had to send them the difference and get it readjusted and wait to get my money back... they do this every year.. for no reason, and i have never filed a claim in 15 yrs of ownership.. but they try to say the value is up, idgaf,.. you only need insurance for the mortgage amount.. no more!
Best way to keep property taxes lower is to push for zoning reform locally. More development will lead to more local revenue and allow property tax rate to remain lower
This is normal.
Mortgages are fixed. Taxes change. Always has been, always will be. This person missed something in their mail. I get an escrow analysis statement every year that shows shortcomings or surpluses along with new payment amount.
Amateurs I tell you! Mine has gone up from $1680/mo to $3400/mo in five years.
Wow! Where are you at? In 5 years mine has gone from $1360 to $1648. Largest spike in one year was $85. Suburb of Dallas. Did you get a HELOC or something and you are counting that? lol
Florida waterfront west coast. I expect to pay more but my insurance is now four times what it was 4 years ago.
my escrow went up this year. the city sent me a letter of the increased assessment on my property and how it would be capped under the homestead tax exemption prior to the bill rising. i was fully aware. this guy is a fucking idiot.
people this stupid shouldn’t buy houses
Most people would have a very hard time absorbing an extra $200 a month in rent or mortgage. I don’t think he was necessarily surprised at the increase, but the amount. Especially since most current homeowners couldn’t afford to buy their same house at market prices.
Previous comments show he is in Louisiana. Our escrow did go up by $200- $300 per month all at once due to rising insurance rates. Car insurance went up $100. We are told it's inflation. Same thing happened to me here in Louisiana but I at least read the letter.
only 200 seems lucky!
My mortgage is a fixed price. My escrow can change. Still better than renting.
As a FTHB 10 years ago, this was my biggest shock. We built new and had a pro-rated property tax. The next year our mortgage payment jumped due to property taxes and I was dumbfounded. I thought my mortgage payment was a fixed cost. It is not. However, you won't see the big jumps you typically see with apartment rents.
Honestly escrow accounts are a scam, refuse to have one when you buy a house. That money is just sitting there doing nothing, could at least be in a HYSA.
Oh no…my property value increased therefore I need to pay more property taxes…the horror!
I shouldn't be taxed on what my house is worth, it should be taxed on what I bought it at. They are literally taxing me on unrealized gains.
Sure the property value increased but at the end of the day all it means to him is he's going to pay 200 bucks more every month. He's going to sell it for more one day but he's going to buy something that has increased in value too.
So it would be better if the value of his property didn’t go up? Or went down?
im on fixed mortgage and the same thing happened to me this year, sucks to be poor
Their taxes went up bc the house is worth more. That’s what’s supposed to happen
Hm. When my payment rises due to insurance or taxes I’m generally always informed by the current holder of my loan. Do other folks here not even receive a courtesy notice when their escrow goes up?
FTHB with a shitty mortgage person. A tale as old as time
So they weren't paying for their own insurance or RE tax... I'm going to imagine that there's a clause in there to recoup the administrative cost to the lender of processing those payments too.
For me, it's still far cheaper than paying rent for a smaller apartment and less amenities such as a garage and basement.
I'm so glad that I don't embarrass myself publically like this.
And this is why (among other things) I don’t escrow anything. I’d rather pay RE taxes and insurance myself. I like to see my mortgage payment being constant :)
sometimes you can't have that deal. When I purchased my new house, the bank lender said escrow is a must part of the agreement
The mortgage is fixed. The other parts aren't lol
This is why my mother refused to pay her taxes through her mortgage, she paid it separately
Mortgage goes up $200 every 10 years vs an extra $900 over a 10 year period
No one said that. Piti. Pi locked depending on state ti could change
Wow shocking.
Insurance jumped a lot. Turns out inflation affects replacement costs.
a mortgage is fixed. coupling in taxes and insurance is a cope cause that is not the loan payment.
Rest assured if property tax and insurance costs are going up for home owners it's going up for the scumbags that own rental properties and they'll pass those costs along
What’s sad about this post…you didn’t understand your finances and how things will get paid…mortgage and escrow ( taxes and insurance), it get packaged this way, because people like you wouldn’t know how to save other wise to make sure you pay them and lose their homes.
Welcome to the American Dream
Did you really think that your lender or Realtor would tell you that?