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Anita Said:

What is included in finding the escrow amount for our house mortgage?

We Answered:

Did they send you anything with totals for last year? It could be that they didn't hold out enough last year and are making up the difference. It might also take until the next time they change your payment for the new insurance rates to be entered in their payment formula. They are only allowed to have a certain amount in escrow so if it turns out they have too much because of the lower insurance rate then they should send you a check when they reach that point. As far as I know, they only update payment amounts once a year so you'll probably have to wait until the next time they update to see a lower house payment.

Salvador Said:

What would be the difference In FHA loan terms with putting 3% or 5% down?

We Answered:

FHA recently changed their insurance amounts. For a brief period the up front mortgage insurance premium was tiered based on credit score. Now all new purchases and refinances (not streamline) have an upfront premium of 1.75%. However you would see savings on the monthly insurance. For loans with 5% or more down, the monthly is .50% so on a $200,000 loan this would be $1000 a year or $83.33 a month. With only 3% down you would be at .55%. Which using the same loan amount would be $1100 a year or $91.67 a month. Either way, mortgage insurance has been made tax deductible for the next few years, so at least you can write it off unlike in the past.

Geraldine Said:

Will decrease in homeowner's insurance premium decrease my monthly payments?

We Answered:

It may, but probably not until your escrow balance is reviewed and then you may get a check for the extra money in your escrow account and at that time your payment may get adjusted. At least that is how mine works, but it only gets review once a year regardless of changes to taxes or insurance.

Gary Said:

Recommended personal insurance?

We Answered:

I am not a financial adviser, but I know a little about the industry. You seem to be requiring 3 different products.

Building Insurance with accidental damage (do you want contents cover) is it for a personal mortage or a buy to let mortgage.

Life insurance (this is personal insurance attached to your mortgage) and needs to be the minimum value of your mortgage.

Critical Illness Insurance is again a separate policy and can be quite expensive depending on what you want to cover.

It is doubtful you will find a single company that can meet all your needs for the best service, cover and price.

You may well have to enlist the help of a broker or adviser to help you. All policies carry an element of commission. The adviser can often take his commission up front or be paid a commission on a monthly basis for the term of the policy. Or you can pay a fee to the adviser. Often it work out the same. You could go direct to companies but you will have to do a lot of research yourself before you find the best options for you. You could use comparision companies which can save you a lot of leg work. Direct companies are not always the cheapest though.

Work out 1) what you want the policy to do for you 2) your budget 3) what is important regarding service levels 4) how you want to proceed i.e. face to face or just do it on-line.

On-line is generally cheaper as they can offer discounts. If you go with an adviser they will do all the paperwork for you.