Or. Admin. Code § 274-045-0150 - Property Tax Amortization and Escrow Accounting
(1) Except as otherwise provided herein,
payments required on all loans shall include an amount, which represents
advances, for taxes paid by the Director of Veterans' Affairs (Director) on the
security. If for any reason the taxes cannot be paid on November 15th, the
Director will send the notice as soon as possible after the taxes are
paid.
(2) All applications, for
permission to pay taxes and hazard insurance directly, will receive a written
approval or disapproval from the Director. If the application is approved, the
applicant will be advised of the date when the Director will discontinue making
disbursements, if applicable, and the date the loan payment will be adjusted,
if necessary.
(3) The Director may
revoke any permission granted concerning the payment of taxes and hazard
insurance on the security by giving the owner of the security 30 days written
notice of the revocation, except as otherwise provided herein. If the Director
advances funds to pay unpaid taxes and/or hazard insurance, any advance by the
Director for such a shortage/deficiency also will constitute immediate
revocation by the Director of permission for the owner to pay directly any
taxes and hazard insurance due on the security, and the account will revert to
the last signed agreement between the Director and borrower for the payment of
taxes, hazard insurance and other obligations. Any advances by the Director,
including any interest and fee, shall be paid back within the remaining
payment/escrow year. The borrower may not change this obligation without prior
written approval from the Director.
(4) Pursuant to the provisions of ORS
407.169,
under this division, escrow accounts are available for the prepayment of
estimated property taxes and hazard insurance premiums.
(5) On monthly simple interest loans with
escrow accounts, the required escrow payment may be based, inter alia, on the
preceding year's disbursements for such items as property taxes, hazard
insurance premiums, other required insurance premiums such as mortgage
insurance, and condominium or homeowner's association dues. In cases of
unassessed new construction, the estimate may be based, inter alia, on the
assessment of comparable residential property in the market area.
(6) The Director will pay interest on the
escrow account as provided by ORS
86.245(1)
to (4).
(7) Under this Division, all escrow accounts
on monthly simple interest loans will be administered in the following manner:
(a) The Director may require a cushion that
shall be no greater than 1/6 of the estimated total annual disbursements from
the escrow account. Estimated disbursements may be modified by an amount not
exceeding the most recent year's change in the national Consumer Price Index
(CPI) for all urban consumers (CPI, all items);
(b) At the end of an escrow account
computation year, an aggregate analysis will be completed on each escrow
account to determine the borrower's escrow account payment(s) for the new
payment year. The borrower will be notified of any shortage, deficiency, or
surplus in the escrow account and the amount of escrow account payment to be
included in the loan payment;
(c)
Except if a loan is two (2) months or more delinquent in payments, an analysis
will not be done until the loan is brought current;
(d) If the analysis determines there is not
sufficient money in the escrow account to pay the required disbursements, the
Director may advance the shortage/deficiency. The required escrow payments on
the loan will be increased to recover any interest, fee or other advance by the
Director for such a shortage or deficiency, or the borrower may repay the
advance, interest or fee in a lump sum;
(e) If the analysis determines there is a
surplus in the escrow account equal to or greater than $25, the entire surplus
shall be refunded to the borrower. If the surplus is less than $25, this amount
will be retained in the escrow account and credited against the next year's
escrow payments;
(f) A statement
itemizing all escrow account activity, (annual escrow analysis) will be
provided to the borrower each year.
(8) The following definitions apply to
section (7) above:
(a) "Aggregate analysis"
means to analyze the escrow account by calculating the sufficiency of escrow
funds as a whole, as opposed to calculating components separately.
(b) "Cushion" means funds that the Director
may require a borrower to pay into an escrow account to cover unanticipated
disbursements or disbursements made before the borrower's payments are
available in the account.
(c)
"Deficiency" means the amount of a negative balance in an escrow
account.
(d) "Escrow account" means
any account that the Director establishes or controls on behalf of a borrower
to pay taxes, insurance premium, or other charges, as applicable.
(e) "Escrow account computation year" means a
12-month period that the Director establishes for the escrow account.
(f) "Shortage" means an amount by which a
current escrow account balance falls short of the target balance at the time of
escrow analysis.
(g) "Surplus"
means an amount by which the current escrow account balance exceeds the target
balance of the account.
(h) "Target
balance" means the estimated month end balance in an escrow account that is
just sufficient to cover the remaining disbursements from the escrow account in
the escrow account computation year, taking into account the remaining
scheduled periodic payments, and a cushion.
Notes
Publications: Publications referenced are available from the agency.
Statutory/Other Authority: ORS 406.005 & 407.115
Statutes/Other Implemented: ORS 407.075 to 407.385; Oregon Constitution Article XI-A, Section 3
State regulations are updated quarterly; we currently have two versions available. Below is a comparison between our most recent version and the prior quarterly release. More comparison features will be added as we have more versions to compare.
No prior version found.