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#2243561 - 10/05/20 08:52 PM Commercial Loans and Escrow
TeamComply Offline
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Joined: Aug 2016
Posts: 393
We have a couple of commercial customers who want us to escrow their insurance/taxes on their commercial loans. We currently charge a flat fee to set-up this escrow (and thus far, this escrow has only been for one property per loan). In the event a commercial customer wants us to escrow their insurance/taxes on multiple properties that are used as collateral on a loan, for instance escrow on 6-10 separate rental properties, can we charge this flat escrow set-up charge X the number of properties? For instances, if a $100 set-up fee is charged, can we charge $600, in the event there are six different properties in which escrow is being set-up for? Setting up and maintaining an escrow account as a service to the customer involves a lot of time/work, so we'd like to restructure our fee for this service and charge it for each property with escrow, rather than just a flat fee for the service, regardless of the number of properties involved.

Is this a state law issue? Or what rules govern this? How do other banks charge fees for voluntary escrow of multiple properties on commercial loans? Thanks.

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Lending Compliance
#2243568 - 10/05/20 09:24 PM Re: Commercial Loans and Escrow TeamComply
rlcarey Online
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rlcarey
Joined: Jul 2001
Posts: 77,307
Galveston, TX
I highly doubt any State law is going to address commercial loan escrow pricing. It is purely a pricing decision. No different than what you charge them to maintain a checking account or buy a cashier's check - it is just a service.
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#2243589 - 10/06/20 03:10 PM Re: Commercial Loans and Escrow rlcarey
TeamComply Offline
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Joined: Aug 2016
Posts: 393
Ok, so no compliance concerns with charging this flat fee on a per property basis, rather than a per loan basis?

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