Wisconsin passed a bill eliminating the requirement that lenders and servicers pay interest on funds held in escrow. Under the bill, lenders and servicers are no longer required to pay interest on escrow funds in connection with first lien residential mortgage loans (loans secured by a 1-to 4-family dwelling occupied as the borrower’s principal residence) originated on or after April 18, 2018. Note that lenders and servicers are still required to pay interest on escrow funds in connection with residential mortgage loans originated prior to April 18, 2018 (unless the funds are held by a third party in a noninterest-bearing account).
See Wisconsin State Legislature website for the full text of the Statutes:
https://docs.legis.wisconsin.gov/2017/related/proposals/ab822.pdf
