Ailing lender's checks bounce -- baltimoresun.com
Shu Bartholomew sent this along. Lenders insist on creating an escrow account and having mortgagors send their property tax payments to the lender along with their house payment. Then the mortgage company makes their property tax payment for them. That's supposed to be so much more reliable than having the flighty wastrel of a homeowner do it him/herself, because the owner will of course have no money when the payment comes due.

Right. Now it seems that American Home Mortgage sent out a bunch of rubber checks. Question: where is the money that is supposed to be in the so-called "escrow" account that each of these owners is supposed to have, safely maintained by the dependable mortgage company?

And of course now the owners are delinquent and may end up having to cough up the money...again. They are the ones who owe the taxes, not the mortgage company.

Checks sent out by the troubled American Home Mortgage Investment Corp. to pay the property taxes of more than 70 homeowners in the Baltimore metropolitan area have bounced, local officials said yesterday. Baltimore City received bad checks for 53 properties - a total of about $63,500. Baltimore County said American Home Mortgage checks bounced for 21 properties, totaling $41,000. Taxes are due at the end of the month.