The Porch Light

News and perspectives from Northern New England's nonprofit leader in affordable housing

Why Escrows Can Increase in Fixed-Rate Mortgages


Explaining Increasing Escrow: With 2016 just around the corner, many families are looking at their budgets for next year and wondering how the mortgage payment will fit into their finances. Did your mortgage payment increase even though you have a fixed-rate mortgage? That’s because of an increased escrow payment. With any mortgage, there are two reasons why your escrow could increase:


  1. Regular Yearly IncreaseHOC 1

Your monthly mortgage payment includes more than just the principal and interest on your loan.  It also includes money that goes into an escrow account that pays your property taxes and homeowners insurance.  It is completely normal for your mortgage payment to go up a little bit every year as property taxes increase.  Some of the increase that you’re  seeing on your  2016 mortgage payments is simply your mortgage company anticipating that your taxes will rise, and trying to adjust your payment to make sure that your escrow account will have the funds to pay the taxes.


  1. Increase Due to Escrow Shortage

     The reason why our payments are going up more than we are used to is because the mortgage companies underestimated the amount that our property taxes would increase…

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Free financial counseling for Avesta residents


The Avesta NeighborWorks HomeOwnership Center (HOC) is partnering with Avesta Housing communities to offer free financial counseling and education to residents. The HOC is excited to help Avesta residents meet their financial goals!

In these financial counseling sessions, affordable-housing residents learn about how to build a strong credit score. The goal of our resident seminar is to demystify how credit works and empower residents with the knowledge they need to feel in control of their credit. The HOC’s credit-counseling clients often say that they are “afraid” to look at their report because they don’t want to face a bad score. This fear stems from the fact that people don’t understand how credit works and aren’t aware how simple changes can increase their score.

fico score, financial counseling, affordable housing, avesta


For example, many people don’t realize that closing old cards you don’t use anymore can decrease the length of your credit history and pull your score down. It’s also important to realize the balances that you carry on your cards are almost as important as whether you pay your bills on time! Instead of paying off cards one at a time, a better strategy might be to…

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