Property tax and insurance rates change, so sometimes we need to adjust your monthly escrow amount to ensure it can cover these payments.
At least once a year, we run an escrow analysis on your account that focuses on these areas:
- Your escrow account balance, monthly payment amount, and minimum required balance.
- The recent tax and insurance payments—or disbursements—we’ve made from your escrowed account.
- Projected property tax and insurance amounts, and their due dates, for the next year.
We’ll send you an Escrow Review Statement explaining the results.
Usually, your statement will inform you that your monthly payment is going up or going down in the year ahead, based on this year’s tax and insurance payments. You may also end up with a shortage (too little in your account) or a surplus (too much) based next year’s projected payments.
When Will You Analyze My Escrow Account?
We analyze your escrow account around the same time each year, depending on the state where your property is located.
Details of your previous analysis are in the “Escrow Analysis” tab.
Transferred loans fall into the standard analysis cycle, unless the next cycle is more than 12 months from the last escrow analysis date (as provided by your prior servicer).
How Does an Analysis Effect My Payment?
An escrow analysis can raise or lower your monthly escrow payment for the upcoming year due to changes in your tax and insurance amounts.
Changes to what you owe for taxes and insurance are made by your taxing authorities and insurance providers, not Mr. Cooper. Please contact your local taxing authority or insurance provider if you have questions.
Surplus & Shortage
Your escrow analysis may reveal a shortage or a surplus in your escrow account.
A shortage means we’ve projected that your escrow account will fall below the minimum required balance at some point next year.
Note: Your Escrow Review Statement will pinpoint the exact month(s) where there aren’t enough funds.
To collect the shortage, we will automatically spread the shortage amount over the next 12 months. You can prevent this additional monthly payment increase by paying the shortage as a lump sum before the new payment effective date, but it is not required and completely voluntary.
A surplus means there’s probably more in your account than we’ll need.
How Do You Know If I Have a Shortage or Surplus?
On your Escrow Review Statement, you’ll see a month-by-month projection of your upcoming escrow contributions. You’ll also see the timing and amounts of upcoming disbursements we expect to make on your behalf.
Then, we compare your escrow account’s lowest projected balance in the year ahead to your minimum required balance.
- If it’s less than your minimum required balance, you have a shortage.
- If it’s more than your minimum required balance, you have a surplus.
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)
Will I Receive a Refund If I Have a Surplus?
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 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.