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Escrow Account Basics


    What is an Escrow Account?

    An escrow account acts like a savings account for the payment of your taxes and/or insurance. As each mortgage payment is made, a portion of your payment is deposited into the escrow account. Dallas Neighborhood Homes will use funds from that account to pay your tax and/or insurance bills as they are due.

    Why am I required to have an Escrow Account?

    An escrow account is required. The benefit of an escrow account is that you can combine all of your mortgage related expenses into one monthly payment.

    Why is a minimum balance required on my Escrow Account?

    Dallas Neighborhood Homes requires a minimum balance in your escrow account equal to two monthly escrow payments. These funds provide a cushion if your insurance or tax bills increase.

    Who can I contact with questions?

    Call Customer Service at 888-568-3405 or stop by the Dallas Neighborhood Homes servicing center.

    2800 N Hampton RD | Dallas, TX 75212

    Escrow Payments

    What bills are paid from my Escrow Account?

    The funds in your escrow account are used to pay:

    • Homeowner’s Insurance
    • Property Tax
    • Other Forms of Insurance as applicable, such as Flood, Mortgage, Wind/Earthquake

    How is my monthly payment determined?

    The monthly escrow payment is calculated by taking the sum of all applicable bills and dividing this by 12. For example, if your insurance for the year was $600 and property tax was $1400, your monthly payment would equate to $166.67.

    If my payment amount changes, will my Dallas Neighborhood Homes ACH payment automatically update?

    If you have your mortgage payments set up with our ACH payment system, the amount will automatically update upon any changes. If you are using any other payment methods, you'll need to update the amount.

    When are my payments due?

    Your escrow payments are included in your monthly mortgage payment. To ensure timely payment, please follow the information provided on your monthly mortgage billing statement.

    Can I make extra payments specifically to my escrow account?

    Absolutely! It is possible to make an additional payment to your escrow account. This may be an option for you if you have seen an increase in your tax or insurance payment throughout the year and wish to avoid a shortage at the time of your analysis. If you want to make an extra payment towards your escrow account, please follow one of the following methods:

    • Call Customer Service at 888-568-3405.
    • Stop by any Dallas Neighborhood Homes servicing center.

    To avoid confusion, do not send additional escrow payments with your monthly mortgage payment. It is possible for these funds to be applied as a payment against your principal rather than to the escrow account.

    Annual Escrow Analysis

    Why did I receive an overage check? What are my options?

    An escrow account overage is caused when the monthly tax and insurance payments were lower than projected. If your overage equals $50 or more, Dallas Neighborhood Homes is required to send you a refund via check. In some cases, you may have an overage in the account even though the tax or insurance projections have increased for the following year. You have the option to send the overage check back to us and have it reapplied to your escrow account. If your overage is less than $50, the amount will be applied to your escrow account to assist with the next year’s payments.

    What are my repayment options if I have a shortage?

    You have three options to pay an escrow account shortage:

    • You can pay in full. Send in a check as instructed on your annual escrow analysis or contact Customer Service at 888-568-3405
    • You can pay a portion of the shortage up front, then spread the balance of the shortage over your 12 monthly mortgage payments. Send in a check as instructed on your annual escrow analysis or call Customer Service at 888-568-3405
    • You can pay the shortage over the next 12 months. The balance of the shortage will be spread over 12 months and added to your monthly mortgage payment.

    The full instructions for how to pay your shortage will be provided on your annual escrow analysis, if applicable.

    When will I receive my annual analysis?

    The date of your annual analysis is completed annually in January each year. If there are changes to this schedule that affect your annual analysis, you will receive a notification.

    Tax & Insurance

    Do I need to send you my tax bill?

    Your tax agency will send a copy of your tax bill directly to Dallas Neighborhood Homes. You should retain the tax bill for your records. If you receive a tax bill marked “COPY” or “FOR YOUR INFORMATION,” you do not need to send it to us.

    Why are you collecting funds when I paid my taxes and/or insurance at closing?

    Dallas Neighborhood Homes will begin to collect funds in your escrow account even if your next payments are a year away; this is to ensure there is no shortage on your escrow account.

    Where am I able to see the expected cost of my tax or insurance bill?

    You can locate the expected expenses for the next year on your annual escrow analysis. This document will be mailed to you annually and is always available in the statement section of your account on www.dallasneighborhoodhomes.com.

    Is it required to carry homeowner's insurance?

    All mortgage lenders require that you have homeowner’s insurance. As a homeowner and in accordance with your loan documentation, you need to maintain adequate homeowner’s coverage at all times.

    What is Lender-Placed Insurance?

    If your insurance coverage lapses or you don’t have enough coverage, Dallas Neighborhood Homes is required to purchase insurance on your behalf. This is done so your home can be repaired or rebuilt if it is damaged. Please note that this type of insurance does not cover your personal belongings and you will want to discuss your insurance needs with your insurance company as soon as possible.