1 week ago I closed on a re-finance on my home. This week I was notified that they had not calculated my escrow account accurately, forgetti...

Question

1 week ago I closed on a re-finance on my home. This week I was notified that they had not calculated my escrow account accurately, forgetting to include the adjusted property taxes since my home was new last year when I purchased it. I was told that I would have to pay $2400. for Septembers taxes and then pay an additional $400 per month on my house payment/escrow. I had changed from Chase Mortgage 30 year fixed at 3.75% to a 20 year 3.87% fixed rate. The lender has offered to re-write the loan to 30 years and try to get my interest rate back to 3.75% to keep my payment at a reasonable level. My question is there anything else I can do? I was in the middle of purchasing a new vehicle which thankfully I was able to stop because of this mess and I'm wondering if I have any recourse....Turns out he is not "able" to move my rate back to 3.75% but rather keep it at 3.87% so now I am in a worse position that if I would have left it at chase. The reason I was refinancing was because I had added equity by completing a master suite and bath and was able to stop paying the PMI, while at the same time reducing my term to 20 years. Now I'm back at 30 with a higher interest rate and out the fees for the refinance process. Shouldn't they have to make me "whole" if you will?

Answer

I can understand how this would be frustrating. The problem is that you are responsible for the real estate taxes one way or another. It is possible someone made a mistake by not catching the increased tax amount sooner. However, consider if they had caught it sooner. You would have ended up paying the $2,400 as well as the extra $400 per month right out of the gate instead of it coming up after your closing, so you are now in the same position. In addition, it may be that the new tax amount just became available in the last week or two, so perhaps there is no error here at all. If you are interested in a more comprehensive answer, you would need to take all of your closing documents, as well as your disclosure documents, to a real estate attorney for review.