Question

On HUD what does "Repair escrow" mean?

On HUD what does "Repair Escrow" and "110% of Escrow Total" mean? What is the difference between the 2 numbers and who puts down this money?

7 years ago - 1 answers

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A repair escrow is an amount of money put on deposit in the title company's trust account, to pay for required repairs on a property.

Generally speaking, lenders would require the work be done prior to allowing you to close, but some things can't be done in winter in some areas, like painting the exterior, laying sod, pouring concrete. So you'd usually be allowed to put aside that money until weather permits.

And in most cases, they actually require 150% of the estimated amount needed to be put aside, to ensure that if costs do end up higher, the money is right there to pay it. Anything left over goes back to the person whose funds were put aside initially. Usually, it's the seller's money, but it can really come from almost anyone involved in the transaction. So if you only had to do 110%, you're lucky in that regard.

Source(s):

7 years ago