Since an escrow account is simply a holding account for your money, you are entitled to receive that money back if you cancel it. The most difficult part of getting your escrow money back is requesting that the bank return it. Depending on the bank’s policies and the specifics of your loan, you may or may not be able to cancel your escrow account. If you are able to cancel it, the bank should automatically send you your money back. To facilitate the process, you should follow a few steps to make sure you get your escrow balance back in a timely fashion.
Contact your lender and inquire as to the procedure for cancelling escrow. Typically, this is via a formal request in writing. Include your name, account number and the reason you are requesting the cancellation. The bank will contact you, usually by mail, if your request is approved.
Fill out the required paperwork to cancel the account. This usually consists of a form you must sign to acknowledge the cancellation of your escrow.
Instruct the lender as to the manner in which you want the funds returned to you (check, wire, deposit). The bank may or may not be accommodating, based on policy. Some lenders only send a check after the account has been closed.
Ask the lender how long it will take to receive your escrow balance. Depending on the bank’s policy, it can take anywhere from a few days to several months. Knowing the time frame will give you an idea of when to contact the lender if you do not receive the funds.