Sec. 36a-716. (Formerly Sec. 36-442n). Escrow accounts. - Connecticut Statutes

      Sec. 36a-716. (Formerly Sec. 36-442n). Escrow accounts. (a) Any mortgage servicing company which receives funds from a mortgagor to be held in escrow for payment of taxes and insurance premiums shall pay the taxes and insurance premiums of the mortgagor to the appropriate taxing authority and insurance company in the amount required and at the time such taxes and insurance premiums are due provided (1) the mortgage servicing company has been provided with the tax or insurance bills at least fifteen days prior to the date such taxes and insurance premiums are due, and (2) the mortgagor has paid to the mortgage servicing company the amounts required to be paid into the escrow account, as determined by the mortgage servicing company, for all amounts scheduled to be paid to the mortgage servicing company prior to the date such taxes and insurance premiums are due.

      (b) Each mortgage servicing company shall, through its own effort and expense, determine and notify the mortgagor of the amounts necessary to be paid into the escrow account to assure that sufficient funds will be available for the payment of such taxes and insurance premiums as of the date such payment is due.

      (c) If the amount held in the escrow account as of the date such taxes and insurance premiums are due is insufficient to pay the taxes and insurance premiums despite compliance by the mortgagor with subdivision (2) of subsection (a) of this section, the mortgage servicing company shall pay such taxes and insurance premiums from its own funds. The mortgage servicing company shall then give the mortgagor the option of paying the shortage over a period of not less than one year. The mortgage servicing company shall not charge or collect interest on such shortage during the one-year period.

      (P.A. 89-347, S. 4.)

      History: Sec. 36-442n transferred to Sec. 36a-716 in 1995.