Texas Escrow Waiver Information:

Escrow Waiver in Texas with 3% Down Payment! Texas Premier Mortgage offers escrow waivers as a flexible option for borrowers across several loan products, allowing you to manage your property taxes and insurance independently. *You can waive escrows with as little as 3% down payment on a conventional loan and 100% financing on a VA loan* 

The Escrow Waiver does not affect the rate or fees. This decision is free for you with no cost or penalty. Unlike traditional banks, who want to keep your money we give you the option to control your costs and payments.

Most lenders across Texas will make escrow mandatory with less than a 20% down payment on a purchase or 20% equity on a refinance.

no escrow allowed

*Loan Products Eligible for Escrow Waivers  *Alternate options at 5% down payment are not limited to 1st time home-buyer or income restrictions*

  1. Conventional Loans: Conventional borrowers can obtain an escrow waiver with the following key requirements:
    • Minimum FICO score of 620
    • Maximum LTV of 97%
    • At least 2 reported credit scores for all borrowers
    • Maximum DTI of 50%
    • 1st time home-buyer or below 80% (AMI) average median income

Special Considerations for First-Time Home Buyers (FTHB):

  • Must have a FICO score over 680 if over 80% LTV
  • No escrow waivers allowed over 97% LTV

Additional Conventional Loan Restrictions:

  • Loans with delinquent taxes (60 days late) cannot have an escrow waiver
  • One mortgage late is allowed within the last 12 months
  • VA Loans: VA borrowers can waive escrows up to 100% LTV

Loan Products NOT Eligible for Escrow Waivers

  • FHA loans
  • USDA loans
  • Higher-Priced Mortgage Loans (HPML)

Benefits of Escrow Waivers

  1. No escrow waiver fee
  2. Eliminates initial escrow (impound) deposit
  3. Allows borrowers to pay taxes and insurance independently
  4. Potentially lower monthly payments
  5. Less money required at closing

Important Limitations and Exceptions

  • Escrow must be waived prior to closing
  • Option to waive taxes, insurance, or both
  • First-time homebuyers over 80% LTV can only waive escrows with a FICO over 680

Mortgage loan

Borrowers should carefully consider their ability to:

  • Manage lump sum tax and insurance payments
  • Budget for annual or semi-annual large payments
  • Maintain financial discipline without an automatic escrow system

While escrow waivers offer flexibility, borrowers should assess their financial management skills and ability to consistently save for large periodic payments.

Texas Premier Mortgage provides escrow waivers as a borrower-friendly option across multiple loan products, offering flexibility and potential cost savings. However, eligibility depends on various factors including credit score, loan type, LTV, and state-specific regulations.

Call Texas Premier Mortgage to determine specific eligibility and understand the implications of an escrow waiver for your financial situation.

For more information about an Escrow Waiver in Texas, their benefits and loan options and how it may apply to you, please contact us direct or submit the “Quick Quote” form on the right side of this page.