Escrow Set-Up Fee

Does anyone collect an escrow set-up fee? If so, do you mind to share the amount you collect?

No one seems to be answering questions about escrow fees, either set-up or annual. With the increased cost to the bank, we would like to charge for the service. Does anyone know if it is not allowed for some reason?

Whether a fee is allowed or not will all depend on State law. If State law allows, it will be a finance charge and have to be calculated into the APR whether it is a one-time fee or an annual fee.

We are a Georgia Bank and the GA Dept of Banking and Finance has issued no regulations regarding escrow accounts. I can find nothing in RESPA that refers specifically to a Tax Service Fee or any other "escrow" type one time fee.

Since we are not outsourcing the escrow function, we are considering charging a one-time Tax Service Fee of $75.00 which we know will be included in the APR Calculations and will also affect HOEPA calculations. If we were to outsource the service it would cost us anywhere from $85 - $130 per month, per loan.

Can anyone tell me this type of fee is specifically prohibited?

I would like to know if anyone is aware of the rules for the State of Arkansas charging a setup fee.

CQ1 - if not prohibited by State law - then it is not prohibited.

Deb G - you might want to seek guidance for your State banking association.