Refinance Question Loan amount is higher (insurance, loan officer, escrow, fees)

[qhams]

So recently I refinanced with Wells Fargo.

I did the no cost 3 step program. The only fees this should have had was the notary fees.

Before the papers were signed I owed 126,054 on my loan.

When I signed the papers the loan amount was for $127,486.

I was under the impression I would receive a check for what didnt go into escrow.

Instead my new statement shows that a $1410.01 Escrow Refund went into my new loan.

Now I understand that an escrow goes toward paying taxes and insurance.

I also understand that each months payment goes towards paying escrow.

What I was told is that the escrow refund went into escrow balance.

What I don’t understand is if I am already paying each month on the escrow why do I need to have this money go into my escrow, instead of getting a refund check which I could apply to my principle?

I have spoken to about 6-7 different people about this and just can not grasp this. My brother use to be a loan officer and tried to explain it to me but I still dont get it. I was paying on escrow before hand and will continue to do so in the new loan, why in the world do I need that $1410 to pay on the escrow.

I just want to understand this and make sure I will not be losing money.

I am greatful for anyone that can explain this to me so that I understand.

Thanks,

Robert

[VictorBurek]

Possibly 2 things. The $126,054 you claim you owed...was that the principle balance or the actual payoff. Payoff is always higher than principle balance, and that is why your mortgage statement says to call for payoff.

Or it could be you did a FHA loan and they rolled the 1% upfront mortgage insurance into the loan.

As far as your escrow, wells simply transferred your old escrow account to the new loan.

[qhams]

Originally Posted by VictorBurek

Possibly 2 things. The $126,054 you claim you owed...was that the principle balance or the actual payoff. Payoff is always higher than principle balance, and that is why your mortgage statement says to call for payoff.

Or it could be you did a FHA loan and they rolled the 1% upfront mortgage insurance into the loan.

As far as your escrow, wells simply transferred your old escrow account to the new loan.

The 126,054 was the priniciple balance and I guess not the actual payoff. I went back to my online account and looked. So good call there.

I dont believe I did a FHA loan.

What I dont understand is why no one explained that to me to begin with. Because my original question was why is my new loan higher than my preexisting loan.

Thanks so much for explaining this to me.

[Debsi]

Did you skip a month's installment payment between loans?

The difference is probably equivalent to one month's interest payment (the month you're skipping).

[qhams]

Originally Posted by Debsi

Did you skip a month's installment payment between loans?

The difference is probably equivalent to one month's interest payment (the month you're skipping).

One months interest was around $500+ on my previous loan.

[AdotAllen]

Did you not look at the HUD? Once you reviewed it, you should have asked questions then. Why did you think you would get the difference? Also, the loan product could have been a no cash out loan. This means taht you are not allowed to have any cash back at all. I would suggest reading over your loan documents again.