Think of it like a savings account dedicated to the tax and/or insurance expenses required for your property—and as your loan servicer, we help you manage it. Depending on the terms of your mortgage, your escrow account may be set up for property taxes, homeowner's/hazard insurance, flood insurance, and/or mortgage insurance. A portion of your monthly mortgage payment is deposited into your escrow account, and these funds are reserved to pay your tax and/or insurance bills when they are due.
Each month, we deposit a fixed portion of your mortgage payment into your escrow account to cover your expected tax and/or insurance expenses, plus a little extra money in case these expenses increase from year to year—this is known as a cushion. Then, we pay each bill out of your escrow account on your behalf.
Since tax and insurance bills can change from year to year, we review your escrow account at least annually to make sure your balance is sufficient. Then, we send you an Escrow Account Disclosure Statement to inform you of any changes in your escrow activity, as well as any corresponding changes to your monthly payment.
Having an escrow account can save you time and make homeownership easier. Escrow helps you budget for large expenses required for your property, giving you peace of mind. We fully manage the account for you, paying your tax and/or insurance bills on your behalf when they are due. We also review your escrow activity at least annually to help ensure the balance is sufficient based on your expected expenses.
Yes, you need to inform NewDay USA of any changes in your insurance policy. You can send your new policy to us online at ihaveinsurance.com/newday . It's quick and easy! Alternatively, you can fax the policy to 833-253-1132, or mail it to the following address:
NewDay USA ISAOA/ATIMA PO Box 961254 Fort Worth, TX 76161
Any time you change insurance carriers, you need to take these three steps:
Please note: If you have not paid the premium for your new policy and the due date is less than two weeks away, please email evidence of insurance to us at [email protected] and we will expedite payment.
It may take up to 14 days for us to verify the information with your new insurance provider and update your account.
Once you cancel your previous insurance policy, your prior insurance carrier will prorate your refund based on the date you cancelled the policy compared to the coverage period remaining and return any unearned premium directly to you.
Once we receive the billing statement, if you have not paid the premium and your account is escrowed for insurance, we will pay the premium. It may take us up to 14 days to verify the information with the new insurance carrier and pay the premium. If the premium due date is less than two weeks in the future, please email the evidence of insurance directly to NewDay USA at [email protected] with attention to Escrow, and we will expedite payment for the new policy.
It depends. If we paid both premiums from your escrow account within a 12-month period, you will likely have a shortage in your escrow account which you will need to repay. This shortage occurs because we anticipate payment of one premium every 12 months and if we instead pay two premiums during that period, the total disbursements will likely exceed the amount we collected in your monthly payments.
To minimize a potential shortage, you can deposit the funds back into your escrow account any of the following ways:
By mail: Endorse the refund check from the prior insurance carrier and mail the check to NewDay USA at the following address: Attn: Cashiering PO Box 3828 Englewood, CO. 80155. It is important to write "escrow account deposit" on the check.
Online: Deposit the check into your bank account and make a one-time online payment in the amount of the refund. Log into our website or app and go to Payment.
By phone: Deposit the check into your own bank account. Then, make a one-time payment to NewDay USA online or by phone in the amount of the refund, specifying that it should be applied to escrow.
If we did not pay both premiums out of your escrow account or if the new insurance term began at the end of the prior policy’s term, you may keep a refund from the prior insurance carrier with less risk of a future escrow account shortage.
The change to your insurance premium may result in a change to your monthly payment when our next annual escrow analysis is completed. We review your escrow account at least annually and if your escrow account is projected to have a surplus of $50 or more based on what we expect to pay out of your account for taxes and insurance in the upcoming 12 months, we will return the surplus funds to you in accordance with state requirements.
Here’s what you need to do first:
Once you have begun our claims process, you have completed the necessary documentation, and you receive a check from your insurance company, please take the following steps:
For example, if your loan is owned by Fannie Mae (FNMA) or Freddie Mac (FHLMC) and you are not behind on payments, the first $40,000 will be mailed to you and any remaining funds will be deposited into your escrow account and released as repairs are made. Typically, inspections will be required to verify the completion of repairs before additional funds are released to you.
For information specific to your loan, please contact our Disaster Claims team at 833.253.1133.
You may use insurance proceeds to pay off your loan, but keep in mind, if you choose to do this, you would then own the property “free and clear.” This means you are liable for all activities associated with the property – for example, clearing debris, making repairs, paying taxes, and paying insurance.
Yes, if you have an escrow account set up for your property taxes and you have received a tax bill, please email a copy to us so we can ensure timely payment.
You will receive a statement from us for the time we serviced your account. We send these statements by January 31st each year. If you are enrolled in paperless statements, we'll notify you by email when your statement is ready to view online. Otherwise, we will mail a paper copy to the mailing address you have provided.
A real estate tax exemption is a reduction (or elimination) of a property tax liability (this is the amount you owe to your local tax authority for a given year). As a homeowner, you can request a property tax exemption from your local taxing authority. The process for requesting a tax exemption and approval timelines vary by taxing authority.
If you have questions about tax exemptions, please contact us. We'll be happy to help!
Not all exemption requests are approved, and some are approved at a lesser amount than you anticipate. As a result, we are unable to change the escrow portion of your monthly mortgage payment until we receive confirmation that the exemption was granted and the amount.
In our experience, taxing authorities may take up to 90 days to process exemption requests. If you have questions about the status of your request, you may contact your taxing authority.
Great news! If you have an escrow account, please email us a copy of the written notification that confirms your tax exemption. We make every effort to proactively monitor your property tax liability to identify new exemptions, however you may be notified that the exemption first.
We review your escrow account at least annually to help ensure it has enough money to cover your expected tax and/or insurance expenses. Next time we review your escrow account, surplus funds of $50 or more will be returned to you if, at that time, your escrow account has sufficient funds and your mortgage is current (meaning no payments are past due).
If our recent annual escrow analysis found a surplus and you received a refund, there are a few possible reasons it was less than expected.
For example, if your escrow account is also set up for other expenses like homeowner’s insurance and/or HOA fees, one or more of these other expenses may have increased.
In addition, a tax refund will be impacted by the effective date of the exemption. If you received a 100% tax exemption effective June 1, 2023, the escrow portion of your monthly payment will be updated at that time. However we may need to retain funds previously collected to in order to cover property taxes due for the period ending May 31, 2023.
If you're changing home insurance companies, you'll need to provide our mortgagee clause for your new policy. This lets your insurance provider know where to send premium notices, bills, and claim information/funds.
The mortgagee clause on your insurance policy should be:
NewDay USAISAOA/ATIMAPO Box 961254Fort Worth, TX 76161