• Mandated Interest Rates Increase For Escrow/Special Purpose Accounts
  • March 10, 2017 | Author: Marjorie A. Corwin
  • Law Firm: Gordon Feinblatt LLC - Baltimore Office
  • Maryland law requires depository institutions doing business in Maryland that make first lien residential real property loans and maintain escrow accounts for those loans to pay a minimum rate of interest on the escrow accounts. Maryland law also requires Maryland-chartered banks that offer certain short term "special purpose" deposit accounts (for example, Christmas Club Accounts) to pay a minimum rate of interest on those deposit accounts. The minimum rate of interest on these accounts is based on the weekly average yield of United States Treasury Securities adjusted to a constant maturity of one year as of the first business day of the calendar year. The minimum rate of interest to be paid on these accounts for 2017 is 0.89% (i.e., the statutory prescribed rate as of January 3, 2017, the first business day of 2017). This is up from 0.61% which was the minimum rate to be paid in 2016.