Changing homeowners insurance with escrow can be a straightforward process, but it is important to understand the steps involved. Escrow is a third-party account used to hold funds for a real estate transaction. In this case, the escrow account is used to hold payments for homeowners insurance. This article will provide an overview of the process of changing homeowners insurance with escrow.
Step 1: Check Your Mortgage Agreement
The first step in changing homeowners insurance with escrow is to check your mortgage agreement. Your mortgage agreement will provide information on how to change your homeowners insurance with escrow. It will also provide details on any restrictions or requirements that must be met before the change can be made.
Step 2: Contact Your Lender
Once you have reviewed your mortgage agreement, you should contact your lender to discuss the process of changing homeowners insurance with escrow. Your lender will be able to provide you with information on the process and any documentation that must be completed.
Step 3: Shop for a New Policy
Once you have discussed the process with your lender, it is time to shop for a new policy. You should compare policies from multiple providers to ensure you are getting the best coverage at the best price.
Step 4: Submit Required Documentation
Once you have selected a new policy, you must submit the required documentation to your lender. This documentation includes the policy information, the premium amount, and any other information required by your lender.
Step 5: Update Your Escrow Account
Once your lender has received the required documentation, they will update your escrow account. This will include changing the policy information and premium amount in the account.
Step 6: Make Your Payment
Once your escrow account has been updated, you must make your payment. This payment will include the premium amount for the new policy as well as any escrow shortage or overage that is due.
Step 7: Monitor Your Escrow Account
Finally, you should monitor your escrow account to ensure that your payments are up to date. This will help to ensure that your homeowners insurance is always current and that your escrow account is in good standing.
Changing homeowners insurance with escrow can be a straightforward process, but it is important to understand the steps involved. By following the steps outlined in this article, you can ensure that your homeowners insurance is always current and that your escrow account is in good standing.