4.4 COLLECT LOAN PAYMENTS AND ENSURE PAYMENT OF TAXES AND INSURANCE (06/02/16)

Owned by Kacey Olson
Nov 24, 2018
1 min read

© RHS HB-1-3555 SFH Guaranteed Loan Program Technical Handbook

The servicing lender, or their representative, must collect the borrower's monthly payment and apply the funds to the borrower's account in accordance with the terms of the promissory note and mortgage. The servicing lender must maintain first lien position and ensure that real estate taxes and hazard insurance premiums are paid when they are due. If tax and insurance funds are collected from the borrower, they must be held in escrow in accordance with the RESPA, and must be deposited in an account insured by the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Administration (NCUA). A lender that is not able to hold funds in escrow must have a plan that ensures that taxes and insurance are paid, as described in Attachment 4-A.