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#113347 - 09/09/03 02:50 PM Property Taxes
Suwannee Offline
Platinum Poster
Suwannee
Joined: Jun 2002
Posts: 641
Florida
It is my understanding that in the State of Wisconsin that borrowers have a right to the escrow money for paying real estate taxes. Where can I obtain information on how a lender issues an escrow check for payment of property taxes if there is more than one borrower on the loan? Is the check supposed to be made payable to the order of the tax collector with BOTH borrowers names on the check? What happens when there are more than two borrowers? How many names have to appear on the check? Thanks for any insight you can give.
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#113348 - 09/09/03 03:14 PM Re: Property Taxes
Anonymous
Unregistered

Down here in sunny Florida we rarely use checks and don't pay individually. We receive a file with the tax collectors property numbers and amounts due. Our system also has these property numbers. We match everything and wire one large chunk of money. The subsequent analysis will either apply any overage to lower next years payment or the borrower(s) may request a refund. The refund will be payable to all borrowers.

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#113349 - 09/09/03 05:38 PM Re: Property Taxes
Suwannee Offline
Platinum Poster
Suwannee
Joined: Jun 2002
Posts: 641
Florida
That is probably the way it should be done everywhere, but, Wisconsin has a law that states that, at the borrower's request, the lender has to issue the tax escrow money to the borrower, or to the borrower and the tax collector, and the borrower pays the taxes, if this is the way the borrower wants it done. After the borrower pays the taxes, s/he furnishes the lender with a copy of the paid receipt.

My question is if the check only has one borrower's name on it and there are two or more borrowers on the loan, is the lender in violation of state law? By the time a lender puts the name of the tax collector and the name of one borrower on the check, there is not enough room left to add names of other borrowers. Doing this gives one borrower access to funds that belong to all borrowers. So, I am trying to find out if we have to list the names of all the borrowers on the check or can we just list the primary borrower.

The law also indicates that this is for "required" escrow accounts. So, does this mean that if the lender is not requiring the borrower to establish an escrow account, that the law does not apply?

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#113350 - 09/10/03 09:39 PM Re: Property Taxes
jnelson Offline
Member
jnelson
Joined: Aug 2003
Posts: 58
WI
Our bank has sold the servicing rights for most of our loans that require an escrow, so we only have a few accounts. Our standard operating procedure is to issue the check in the name of the treasurer and only the primary borrower, if that is the manner of payment elected by the customer.

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