Escrow Shortage & Surplus

Shortage

A shortage means we’ve projected that your escrow account will fall below the minimum required balance in the coming year.

  • We’ll automatically spread the shortage amount over the next 12 months and add that to your monthly payment.
    Note: This is one of the most common reasons that your payment may increase.
  • You can prevent this additional monthly payment increase by paying the shortage as a lump sum before the new payment effective date, but this lump sum payment is not required and is completely voluntary.
    Note: Your Escrow Review Statement will pinpoint the exact month(s) where the account falls below the minimum required balance.

Important: Even if you pay the escrow shortage in full for this year, your monthly payment may increase due to higher tax and/or insurance amounts to be paid this year.

Surplus

A surplus means there’s more in your account than we’ll need.

  • If you have a surplus of more than $50 and your account is current, we’ll send you a check within 30 days of the escrow analysis.
  • If the surplus is less than $50 and your account is current, we’ll spread the surplus over the next 12 months to reduce the monthly payment.
  • If the account is delinquent, the surplus will remain in the escrow account for future disbursements.
    Note: Current accounts in Nevada (NV) will be sent a surplus check, even if it is less than $50.

Calculating Shortage & Surplus

On your Escrow Review Statement, you’ll see a month-by-month projection of your upcoming escrow deposits, the timing and amounts of upcoming disbursements we expect to make on your behalf, and the running balance of the escrow account.

Then, we compare your escrow account’s lowest projected balance in the year ahead to your minimum required balance.

  • If the lowest projected balance is less than your minimum required balance, you have a shortage.
  • If the lowest projected balance is more than your minimum required balance, you have a surplus.

Example: Let’s say your minimum required balance is $600.

If your analysis projects that your lowest escrow balance in the year ahead will be $350, you have a shortage of $250. ($350 – $600 = -$250)

If your analysis projects that your lowest balance will be $800, you have a surplus of $200. ($800 – $600 = $200)

Note: If your shortage is paid in full, your monthly payment may still go up if your tax and insurance amounts increased last year.

Have more questions or need help?

Give us a call during business hours.

833-685-2567Mr. Cooper Support Line
Monday - Thursday7am - 8pm CT
Friday7am - 7pm CT
Saturday8am - 12pm CT
SundayClosed