What an escrow account is
Start with the account, not with a guess about the interest rate.
An escrow account holds the monthly amounts your servicer collects so it can pay property taxes and insurance. CFPB also calls this an impound account.
The point of the account is to pay those bills a little at a time with the mortgage, instead of leaving you with one or two large bills during the year.Source [1]Source [5]
What an escrow analysis is
The analysis is the servicer's review of that account. It is not a new loan decision.
Property taxes and insurance premiums can change from year to year. When they change, the total monthly mortgage payment can change.
The analysis looks at the account and can reset the monthly amount collected for upcoming tax and insurance bills. It can also show a shortage, a deficiency, or a surplus. Those words have specific meanings in federal escrow rules. This page does not restate how a servicer may collect a shortage, treat a deficiency, refund a surplus, or time an annual statement.Source [1]Source [5]
Read the CFPB escrow regulation
12 CFR 1024.17. USMI does not restate the collection rules.
Compare a payment that went up
Published guide for statement lines. It does not replace this escrow explanation.
The monthly deposit is not the shortage
Look for two different figures before you decide what changed.
One figure is the ongoing monthly escrow deposit for future taxes and insurance. Another figure can be a separate shortage or deficiency from the analysis. They are not the same number.Source [1]Source [5]
Repayment rules vary
Do not assume every shortage is spread over 12 months. Do not assume the servicer can always require a lump sum. Those are regulatory options with conditions. Read the analysis you received and the regulation, rather than a general rule of thumb.Source [1]Source [5]
Read the CFPB escrow regulation
12 CFR 1024.17. USMI does not restate the collection rules.
Documents to compare
Use records you already have. Do not send them to USMI.
CFPB says to monitor mortgage statements and the tax and insurance bills so a problem can be spotted. Line the current papers up against the previous ones.Source [5]
Documents to check
- Previous escrow analysis
- Current escrow analysis
- Current mortgage statement
- Previous mortgage statement
- Property-tax bill
- Homeowners-insurance renewal
- Servicer letters about the escrow account
Questions to ask the servicer
- Which tax or insurance bill changed, and by how much?
- Which amount is the new monthly escrow deposit, and which amount is a shortage or deficiency?
- What repayment option, if any, does this analysis offer?
- Were the tax and insurance bills paid, and on what dates?
- If something still looks wrong, what address do you use for a written notice of error?
If a tax or insurance payment looks missed
Treat an unpaid bill as time-sensitive. USMI cannot tell whether your bill was paid.
If the servicer did not pay taxes or insurance on time, CFPB says to contact the tax authority or the insurance company as soon as possible, and to contact the servicer. An unpaid tax bill can lead to a tax lien.
If the servicer did not pay the taxes, CFPB says to send a copy of the bill with a notice of error to the servicer. A notice of error is a letter disputing the problem. This page does not decide that your payment was missed.
Official help is the CFPB escrow explanation, the escrow regulation, a HUD-approved housing counselor, and the CFPB complaint portal. Filing a complaint does not stop foreclosure. USMI does not take the complaint or the bill.Source [1]Source [2]Source [3]Source [4]Source [5]
Open the CFPB escrow explanation
Official steps for an escrow or impound problem.
Find a HUD-approved housing counselor
Counseling is not provided by USMI.
Submit a complaint to the CFPB
External official option. USMI does not file it for you.
Key terms
Published USMI glossary entries used in this guide.
Escrow account
On this site, an escrow account is the mortgage account used to collect and pay property taxes and insurance—not every real-estate use of the word “escrow.”
Escrow analysis
The servicer’s periodic review of an escrow account to set the next deposits and look for a shortage or surplus.
Escrow shortage
An escrow balance that is below the target balance at the time of escrow analysis.
Mortgage servicer
The company that runs an existing mortgage day to day—statements, payments, and often escrow. It may not be the original lender.
Sources
These official documents support the statements in this guide. Citation numbers in the article match the entries below. Each document appears once, even when it supports more than one statement.
§ 1024.17 Escrow accounts.
Consumer Financial Protection Bureau
Definitions.
View official sourceFind a housing counselor
Consumer Financial Protection Bureau
Consumer-usable HUD-approved counselor search.
View official sourceIf I can’t pay my mortgage loan, what are my options?
Consumer Financial Protection Bureau
Call servicer.
View official sourceSubmit a complaint about a financial product or service
Consumer Financial Protection Bureau
Mortgages accepted.
View official sourceWhat should I do if I’m having problems with my escrow or impound account?
Consumer Financial Protection Bureau
Escrow/impound definition.
View official source
About this guide
These USMI pages explain this site’s limits and methods. They are not independent government sources.
Consumer-journey privacy boundary
U.S. Mortgage Index
No borrower-account intake in consumer guides.
Open this USMI pageWhat U.S. Mortgage Index is not
U.S. Mortgage Index
Platform identity and educational-boundary policy.
Open this USMI page