The other way to do it is to show a payoff without netting escrow in the payoffs and other payments schedule, a credit (negative amount) in the payoffs and payments schedule for the escrow balance from the old loan, and the same calculated initial escrow amounts in section G that you would do under the first method (same dollar amounts because it's the same numbers used to arrive at it).
Either way, an entry in section H doesn't make any sense.
Let's assume that you calculate she needs initial escrow payment (to start up her escrow for the new loan) equal to 3 months plus two cushion months @ 250.00/month (total for insurance and taxes). That would be a total of 5 times $250, or $1,250. She has $1,000 in her current escrow account because she's short one $250 payment. At closing you give her credit for the $1,000 being transferred using either the net payoff method or the separate payoff and credit for the escrow balance, in the payoffs and other payments schedule. That means, to close, she will have to come up with $250 more for escrow than the old loan's escrow balance.
Last edited by John Burnett; 07/01/19 08:28 PM.
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John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8