Need some clarification on CFR1024.17(K)(1) disbursing escrow payment if the borrower is 30 days or more delinquent. What is the rule of thumb if the borrower more than 30 days delinquent when it's time to disburse escrow funds?

(A) When inability exists. A servicer is considered unable to disburse funds from a borrower's escrow account to ensure that the borrower's hazard insurance premiums are paid in a timely manner only if the servicer has a reasonable basis to believe either that the borrower's hazard insurance has been canceled (or was not renewed) for reasons other than nonpayment of premium charges or that the borrower's property is vacant.

If the policy is still active and the property isn't vacant, pay the insurance.

As for property tax, you're likely going to pay it eventually one way or another and the amount is just going to increase. My rule of thumb is to go ahead and pay those as well.

so weird that they would put that specific statement in the reg about delinquency. If it has no impact on the process of paying it, why do that?

Thanks!