NEWS: The Wisconsin Department of Financial Institutions has announced that for 2024, the mandatory interest rate on certain required escrow accounts originated before April 18, 2018 will be 0.18% (up from 0.11% in 2023).
Under Sec. 138.052(5)(am) of the Wisconsin Statutes, a financial institution (including a credit union) that originated a residential mortgage loan prior to April 18, 2018 requiring an escrow account to assure the payment of taxes or insurance, must pay interest on the outstanding principal of the escrow (with some exceptions). Every year, state regulators determine the required interest rate, based on the average of interest rates paid on regular passbook deposit accounts. The 0.18% rate interest rate will be in effect throughout 2024.
As you may recall, a change in state law did away with Wisconsin’s requirement to pay interest on required escrow accounts for new residential mortgage loans originated on or after April 18, 2018. For a review of the impact of that repeal see The League’s November 21, 2018 Compliance Courier: State drops escrow interest rule for mortgages originated April 18, 2018 and after.
The League’s ii Release No. B014 and ii Release No. B047, referencing the escrow rate, are being updated.
State increases escrow interest rate for 2024
Written by
in