Hello Frank,

I suggest you contact your servicer to see what options are available.  I can’t say for sure, but it sounds to me like you are not in a position to establish any set aside to pay taxes or insurance because if you could do that, you could take the money out of your line of credit and pay the taxes for which you are currently delinquent.

You see, a LESA is a set aside of funds available to you on your line of credit, and they are used to pay your taxes and insurance as they come due.  To set funds aside, you must have them available first.  If you have already used all your available proceeds, nothing is left to set aside to pay those expenses.  And if you do have them available, I would have to assume that you would make a request to the servicer and then deliver them. 

I wish I could help more than that, but I suspect that your situation is that you have already used all your available proceeds, and if that is the case, there would be nothing left to establish a set aside with the current loan.  Check with your servicer to see what funds you have, if any, and whether the loan can be refinanced with the proceeds going into a LESA. Give them a call and see if they have a solution for you.