Profile picture for user26564262

Why do fixed USDA loans go up?

I bought my home in 1999 signing a fixed rate USDA guaranteed loan.  My mortgage payment was $448/mo.  Much to my surprise my monthly payment has gone up every year since.  My property taxes and homeowner's insurance was escrowed into the loan.  So the USDA told me this was the reason for the increase.  However, if I paid the escrow shortage my monthly payment would not increase.  So every year I have paid the shortage; yet my monthly payment continued to go up.  My mortgage payment is now $612.39/mo.  How can this happen?  Has anyone else experienced this with USDA?
  • September 14 2013 - Clinton
  • 0
    0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Be a Good Neighbor. Be respectful and on-topic. No spam or self-promotion! See our Good Neighbor Policy.

 
 

Answers (5)

Has nothing to do the USDA, it's the servicer adjusting for higher taxes and or insurance. Your rate is fixed so your P&I can never go up. Ask for a audit of your impound account, that's should tell you everything.
  • September 15 2013
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Profile picture for wetdawgs
Ask for an itemization of the taxes and insurance.     These tend to be bills that are mailed to you as well as your lender when paid from escrow so you should have seen them already.

  • September 14 2013
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

If you have a fixed rate, then it's impossible that your payment would increase by anything other than your taxes or insurance. Also, it has nothing to do with USDA. Keep in mind that even though you've been paying the shortage in a lump sum, it doesn't mean that your monthly amount won't change. One of those escrow amounts has increased. All you are doing by paying the lump sum shortage is making the lender whole because they "fronted" the money on your behalf to pay those bills.

Servicers must follow specific legal guidelines when changing your escrow amounts. It can't be some random amount. I suggest looking at your tax and insurance bill over the last several years. I bet you will see that they have increased.
  • September 14 2013
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Profile picture for user26564262
I believe they did but, like I said before I paid the escrow shortages every year and my mortgage still goes up.

If I ask the USDA for a detailed report reflecting the reason for each annual increase are they legally obligated to give it me?  Because so far the only way I have to calculate it is by going through every payment manually to see the exact annual increase. 

My salary has not increased 36% over the last 13 years and I don't believe taxes/insurance has either.  Any input would be greatly appreciated because it is getting hard to make ends meet.  Thanks for the insight.
  • September 14 2013
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Profile picture for Outer Banks N C
All loans change a little every year since the taxes and insurance are divided by 12 and the result is added to the monthly payment. As taxes and insurance go up each year the monthly payment goes up, or down, by a small amount. Going from $448 to $612 is 36% increase and unless your taxes went up a lot and your insurance went up I would wonder too. Did they?
  • September 14 2013
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.