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#2217230 - 07/09/19 03:52 PM Interest on Escrow/Impound Accounts
Cloud9 Offline
100 Club
Joined: Jul 2008
Posts: 201
2954.8 says that any lender who finances the purchase of a one-to-four family residence and maintains an impound account must pay interest on the amount of at least 2 percent simple interest per year. The interest must be credited to the borrower's account annually. Does that mean as of 12/31 or within the escrow account year?

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#2217244 - 07/09/19 04:27 PM Re: Interest on Escrow/Impound Accounts Cloud9
Reg Warrior Offline
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Joined: Jan 2017
Posts: 190
The law is vague enough that you can select a month (same every year) to credit the interest. You also need to credit interest when the loan is paid in full. Interested is also paid on restricted escrow accounts (insurance proceeds) for rebuilding after a property loss.Our servicer has selected December for the annual credit of interest on escrow.

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#2232308 - 03/04/20 05:14 PM Re: Interest on Escrow/Impound Accounts Cloud9
GrBo1006 Offline
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Joined: Apr 2013
Posts: 106
How would this interest be paid out for interim servicing which loans are held less than a month?

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