What is an escrow account?
What Information is on my Annual Escrow Account Disclosure Statement?
How will you manage my escrow/impound account?
How often does Aurora Financial review my escrow account?
How is my monthly escrow deposit calculated?
What increases or decreases my escrow payment?
What happens to a surplus of escrow funds?
What happens if there is a shortage of escrow funds?
How can I dispute an increase in my escrow payment?
What is Homeowners Insurance (also called Hazard Insurance)?
What does Homeowners Insurance cover?
Where do I send my Homeowners Insurance information?
Do I need flood insurance?
Who arranges Property Insurance?
What happens if my Homeowners Insurance expires before I can renew the policy?
Can I change insurance companies? Does Aurora Financial need to know?
How do I file an insurance claim?
What important facts do I need to remember about my home loan payment?
What is the turn-around time once I've requested a Payoff Statement?
How are interest charges calculated?
How are FHA premiums determined?
How are mortgage insurance premiums determined?
What happens if I have a negative escrow balance at the time?
What happens if I have accumulated late charges on my account?
Do I (or my closing agent) need to verify the payoff figures on the day of closing?
What are the acceptable forms of payment for paying off my loan?
What happens to funds in my escrow account?
What happens with my tax and insurance bills?
What happens with my FHA Insurance?
What documents will I be given?
What is Private Mortgage Insurance (PMI)?
What is the Homeowners Protection Act (HPA) of 1998?
What does loan-to-value (LTV) mean?
What does it mean to have a "good payment history"?
How does LTV based on original value differ from LTV based on a new appraisal?
How do I request cancellation of Private Mortgage Insurance (PMI)?
Will Aurora Financial Group, Inc. automatically terminate my PMI at a certain point?
What is FHA Insurance on my loan, and can I cancel the premium?
Am I entitled to a homestead exemption?
What is an escrow account?
An escrow account is an account into which you deposit funds each month as part of your loan payment. These funds will be used to pay future bills involving your property such as real estate
taxes, property insurance premiums, flood insurance premiums (if applicable) and other expenses which are described in your mortgage contract. Escrow accounts enable us to pay these bills when they
become due. This type of account is sometimes known as an "Impound Account."
What Information is on my Annual Escrow Account Disclosure Statement?
Your Escrow Account Disclosure Statement provides you with your projected and historical escrow activity and your current and new payment amounts, including the portion of the payment going
into the escrow account. This disclosure will also provide you with an explanation of how any escrow surplus or deficiency will be handled.
Your projected escrow activity will list all the escrow deposits that we expect to receive from you in a 12 month period, as well as list all escrow related disbursements that we expect to pay
from your escrow account during the same period. The projection also lists your anticipated and required monthly escrow balance.
The historical escrow activity provides the total amount paid into and out of your escrow account and lists all the escrow deposits and disbursements that were made from your escrow account
from the time your escrow account was last reviewed to the time of your current review. This activity will also list your anticipated and actual escrow balance.
How will you manage my escrow/impound account?
Before an escrow bill is due, Aurora Financial will typically receive the bill information directly from your insurance company, tax office, etc and will use that information to pay your bill.
If we are unable to obtain a copy of your bill, we will send a letter to you requesting your assistance.
How often does Aurora Financial review my escrow account?
At least once a year, your escrow account will be analyzed. An escrow analysis is a review of your escrow account to determine the proper amount of your monthly escrow deposit based on the
bills we expect to receive and pay from your escrow account. Once the analysis is completed, an Escrow Account Disclosure Statement will be sent to you providing you with your new payment
information.
How is my monthly escrow deposit calculated?
Your escrow deposit is equal to 1/12th of the total bills we anticipate paying on your behalf during the next year. In addition, there is a minimum escrow account balance that is permitted by
federal and/or state law and your mortgage document. This deposit is based on the way your mortgage terms are written. Your mortgage terms allow for a minimum escrow balance equal to zero, or, equal
to one or two months of your monthly escrow deposit.
What increases or decreases my escrow payment?
There are several reasons why your escrow payment may increase or decrease:
- A property tax increase or decrease
- A homeowners insurance premium increase or decrease
- A mortgage insurance increase or decrease
- A shortage of funds
- A surplus of funds
- An increase or decrease in other bills we pay for you
What happens to a surplus of escrow funds?
If your loan account is not delinquent and has a surplus of $50.00 or more at the time of your escrow analysis, Aurora Financial will automatically send you a check refunding the surplus to
you. If your surplus is less than $50.00, it will be automatically credited against next year's escrow payments.
What happens if there is a shortage of escrow funds?
If your escrow account balance is less than the required balance at the time of your analysis, your escrow account will have a shortage. Your escrow shortage will automatically be spread over a
12-month period and added to your monthly payment. You do, however, have the option of paying your escrow shortage in part or in full. If you choose this option, your monthly mortgage payment will be
adjusted accordingly.
How can I dispute an increase in my escrow payment?
In the event you believe our calculations are incorrect or you have access to better estimates from a taxing authority or insurance provider, please contact us immediately. We will use your
documented information to perform a new analysis, possibly resulting in a lower escrow and monthly payment amount.
IMPORTANT: Only your taxing authority or insurance company can change the amount of the bill we pay on your behalf. You must contact them directly.
What is Homeowners Insurance (also called Hazard Insurance)?
As a homeowner, you take the risk that fire or other catastrophes may damage your property. In addition, there is the possibility that someone may be injured while on your property and hold you
responsible. It is, therefore, important to protect your home investment with adequate insurance coverage.
What does Homeowners Insurance cover?
Homeowners Insurance covers losses from fire and other catastrophes.
Where do I send my Homeowners Insurance information?
When you signed your loan documents, you agreed to provide us proof of ongoing, continuous insurance coverage for your home. You need to tell us when you make a change in your insurance
coverage by sending this information by fax or mail to:
Fax: (856) 985-8562 Mail: Aurora Financial Group, Inc.
Suite 190
P.O. Box 288
Marlton, NJ 08053
Do I need flood insurance?
If your home is located in a Special Flood Hazard Area, you are required by law to maintain flood insurance coverage equal to the greater of your remaining loan balance or 80% of the
replacement value of your property improvements (but not to exceed the full replacement value of the improvements).
Who arranges Property Insurance?
It is your responsibility to maintain insurance on your property at all times. The insurance coverage must be an amount at least equal to the replacement cost of the improvements on your
property (the home itself) or the outstanding principal balance of your loan, whichever is less.
What happens if my Homeowners Insurance expires before I can renew the policy?
If we do not receive proof of insurance, we will obtain an insurance policy for dwelling coverage and 10% contents. No liability coverage. As the lender, we do this to protect our interest in
your property. The premium will be charged to your escrow account. You will be given prior written notice that we plan to obtain this insurance, which is authorized by your Mortgage. If we obtain
this insurance, we will cancel it when you provide us with proof of coverage on your own policy. There will be a premium charge for the insurance policy obtained by Aurora Financial for any days that
your insurance was not in effect. The coverage provided by the insurance policy ordered by Aurora Financial will be different and more expensive than your expired coverage.
Can I change insurance companies? Does Aurora Financial need to know?
We accept coverage from most insurance companies. If you choose to replace your current coverage, please send your replacement policy, along with your written authorization, to our office so
that it arrives at least 30 days prior to the expiration of your current policy.
Please keep in mind that if you change policies before your current policy expires, you may not receive a full refund from your current insurance company.
How do I file an insurance claim?
Please notify your insurance agent and Aurora Financial immediately when there is damage to your property. Insurance company claim proceeds are in check form and will require our
endorsement.
Because claims are handled differently, depending on the check amount and the loan type (i.e., FHA, VA or Conventional), you will need directions from us as to the proper procedure that must be
followed. Please contact a Customer Service Associate at 1-800 362-8948 for assistance in handling your claim.
What important facts do I need to remember about my home loan payment?
- A good payment record is essential to maintaining a good credit rating. If you encounter problems that could affect the timeliness of your payment, please call a collection representative at 1-800-362-8948. Prompt notification allows our representatives sufficient time to work with you to resolve issues.
- Your loan number, which can be found on your coupon, should be written on all payment checks. Your number serves as your identification and allows us to reference your loan information quickly.
- Regular payments should be made in the amount stated on your coupon. NOTE: Payments, which don't reach our office by the 16th of the month, are subject to a late fee.
- If you send additional funds, please indicate on the payment coupon whether the funds should be applied to principal balance, escrow/impound account, late fees, other fees or future total payments.
- Please do not send any correspondence with your home loan payments. Our payment-processing center is designed specifically for processing payments quickly and efficiently. Please send all payments to Aurora Financial Group, Inc, PO Box 48011, Newark, NJ 07101. Please include your loan number on your check. If you need to write or send documents to us, please mail to Aurora Financial Group, Inc, 9 Eves Drive, PO Box 288, Marlton, NJ 08053. Please reference your loan number on all correspondence. You can also Contact us via email through this site.
What is the turn-around time once I've requested a Payoff Statement?
Statements for regular conventional, FHA, or VA loans are usually mailed or faxed within 48 hours.
Statements for bankruptcy and foreclosure accounts can take up to a week or more to prepare.
How are interest charges calculated?
Interest is calculated to the payoff statement expiration date. A per diem (per day) interest amount will be included for Conventional and VA loans, which collect interest per day. No per diem
will be included for FHA loans, which collect interest per month. Some FHA loans require that, at least 30 days prior to payoff, you notify us of your intent to pay off your loan. Additional interest
could be charged if notice is not received. If you have an FHA loan, contact us at 1-800-362-8948 to determine if your loan is one that requires a 30-day notice. If it does, you may notify us either
by phone or in writing that you intend to pay the loan in full. If your loan is paid ahead, the payoff amount will be reduced by any interest not yet due. For example, if the payoff statement
expiration date is September 1st and the account is paid through November 1st, the interest paid ahead will be subtracted from the required payoff amount.
How are FHA premiums determined?
Any premiums due on an FHA loan by the expiration date of the payoff statement will be collected in the payoff amount.
How are mortgage insurance premiums determined?
Any mortgage insurance premiums due on a Conventional loan by the expiration date of the payoff statement will be collected in the payoff amount.
What happens if I have a negative escrow balance at the time?
Any escrow funds advanced by Aurora Financial to pay your bills because there were insufficient funds in your escrow account will be collected at the time of payoff.
What happens if I have accumulated late charges on my account?
Any accumulated late charges will be added to the amount due. This includes late charges for any payments that are past due at the time of payoff. Therefore, it is important that you continue
to make your monthly payments until the day your loan payoff funds are received by Aurora Financial.
Do I (or my closing agent) need to verify the payoff figures on the day of closing?
The amount due will change if payments were posted to or removed from the account after the payoff statement was ordered. If payoff funds are received after the expiration date of the payoff
statement, the interest amount due will be different. You or your agent should contact our Payoff Department at 1-800-362-8948 on the day of closing to verify the payoff figures.
What are the acceptable forms of payment for paying off my loan?
A certified check or a cashier's check are the only acceptable forms of payment for loan payoff. Personal checks are not acceptable and will delay the payoff process. When the payoff funds are
sent, include your name and loan number, the name and address of the check remitter (if different), and a copy of the Payoff Statement. Title companies and attorneys' offices may send any of the
following:
- Trust account check
- Check drawn from attorney's office account
- Check drawn from closing agent's business account
A cashier's check or certified funds should be made payable to Aurora Financial Group, Inc and sent to:
Aurora Financial Group, Inc. 9 Eves Drive, Suite 190, Marlton, NJ 08053 to the attention of our Payoff Department.
What happens to funds in my escrow account?
Any funds remaining in escrow will be released to you within 30 days of payoff. If any deposits to or disbursements from your escrow account were made after the date of the payoff statement,
your escrow balance will be different from the amount on the payoff statement. Remember to notify us of any mailing address change to avoid delays in receiving the escrow balance.
What happens with my tax and insurance bills?
After we receive your payoff funds, if you still own the property, and did not refinance your loan with us, contact your tax collector and insurance agent to have the bills sent to you. If you
refinanced with Aurora Financial, and we are responsible for paying the tax and/or insurance bills, contact us if you receive the next due tax or insurance bills. This is to ensure that we also have
received the bill and can pay it before the due date. If you refinanced with another company, contact them in regard to the payment of tax and insurance bills.
What happens with my FHA Insurance?
You may be entitled to a refund for unearned mortgage insurance premiums if you had an FHA loan and a one-time premium was paid at the inception of your loan. We will notify HUD (The Department
of Housing and Urban Development) of the payoff of your mortgage. If you are eligible for a refund, HUD will be sending you a claim form to complete.
What documents will I be given?
After the loan is paid off, the Satisfaction of Mortgage (or Release of Mortgage) will be prepared in accordance with the provisions of your mortgage and state law. The release document states
that the loan has been paid in full and the Mortgage may be discharged from the public records.
What is Private Mortgage Insurance (PMI)?
If a borrower has less than 20% down payment for the property they wish to purchase with a conventional loan, the lender may require the borrower to carry Private Mortgage Insurance (PMI).
Private Mortgage Insurance is a type of insurance that protects lenders in the event the borrower defaults on the payment of the loan. Agreeing to carry Private Mortgage Insurance allows the lender
to accept lower down payments, and a lower down payment may help the borrower qualify for a loan.
What is the Homeowners Protection Act (HPA) of 1998?
On July 28, 1998, President Clinton signed into law the "Homeowners Protection Act of 1998". This Act describes the provisions under which mortgagors with conventional loans can request
cancellation of Private Mortgage Insurance. The Act also describes disclosures and notices that are required for lenders to automatically terminate PMI on conventional loans. This Act applies only to
residential mortgages secured by single-family, single-unit, owner-occupied dwellings closed on or after July 29, 1999. Mortgage loans closed before July 29, 1999, or mortgage loans secured for
vacation or second homes, by 2-4 family dwellings or other multifamily dwellings, or by investment properties are not covered by the Act.
What does loan-to-value (LTV) mean?
A loan-to-value ratio can be expressed as the current principal balance divided by either the original property value (the original appraised value or sales price, which ever is less), or based
on a new appraisal. For example, if the current principal loan balance is $123,000, the original property value is $168,000, and the sales prices was $175,000, then the current LTV is equal to:
Current Principal Balance /
Original Property Value
$123,000 / $168,000 = 73.2%
What does it mean to have a "good payment history"?
You are required to have a good payment history in order to request cancellation of your Private Mortgage Insurance. For most loan types, a good payment history is defined as:
No payments 30+ days past due in the last 12 months, AND No payments 60+ days past due in the last 24 months, AND, if your loan has been refinanced, then:
The last 12 consecutive payments must have been made within 30 days of the due date.
If you have anything other than a FNMA or FHLMC loan, there may be other payment history requirements.
How does LTV based on original value differ from LTV based on a new appraisal?
A LTV based on the original property value takes into consideration your current principal balance compared to the original property value. For example, if your principal balance is currently
$89,000 and the original property value was $111,000, then your current LTV based on the original property value is:
Current Principal Balance /
Original Property Value ->
$89,000 / $111,000 = 80.1%
A LTV based on a new appraisal takes into consideration increases in property value that may have been realized since the loan was originated. For example, if your principal balance is
currently $89,000 and the home you originally bought for $111,000 has increased in value to $142,000, then your current LTV based on the property's new appraised value is:
Current Principal Balance /
New Appraised Value ->
$89,000 / $142,000 = 62.6%
In order to validate the current property value, an Aurora Financial approved appraiser must perform a new appraisal obtained at the expense of the borrower. You will be required to contact our Customer Service Department to schedule an appraisal.
How do I request cancellation of Private Mortgage Insurance (PMI)?
In order for us to consider cancellation of your Private Mortgage Insurance (PMI), you will need to submit your request in writing to the address below:
Aurora Financial Group, Inc. 9 Eves Drive, Marlton, NJ 08053 Attention: PMI Cancellation Requests
Will Aurora Financial Group, Inc. automatically terminate my PMI at a certain point?
For certain conventional loans (single-family, single-unit, owner-occupied dwellings closed on or after July 29, 1999), Aurora Financial will automatically terminate PMI when the loan balance
reaches 78% of the original property value (based on the loan's original amortization), or at the midpoint of the loan's amortization schedule, if the loan is current with a good payment history.
What is FHA Insurance on my loan, and can I cancel the premium?
Aurora Financial services loans on behalf of investors who actually own these loans. These investors set forth requirements we must follow in servicing the loan. Based on these guidelines,
Aurora Financial is unable to delete the mortgage insurance requirement for FHA loans. There are advantages to having an FHA insured loan. With FHA loans, customers are eligible for the temporary
mortgage assistance payment plan and other programs. If you have a FHA loan and would like more information on the FHA insurance, please review your closing paperwork.
Am I entitled to a homestead exemption?
Call your tax collector to find out if you qualify and how to apply. If you qualify and have applied by the deadline, the tax amount we receive will include the exemption, and you do not have
to notify us. If you receive a bill marked corrected, adjusted, or certificate of error, call our Tax Escrow Department immediately to advise us not to pay the regular bill. Then mail the new bill
to:
Aurora Financial Group, Inc
Tax Department
PO Box 288
Marlton, NJ 08053
Please include your loan number with this mailing.
Aurora Financial Group, Inc.
- 9 Eves Drive, Suite 190 - Marlton, NJ 08053
