When is escrow analysis done

Escrow analysis is typically done once a year, although it can be performed more frequently if needed.

The process is conducted by the mortgage servicer to review the escrow account, which holds funds for property taxes, homeowners insurance, and sometimes other related expenses like mortgage insurance.

Here’s when escrow analysis is commonly done:

1. Annual Review: Most mortgage servicers perform an escrow analysis annually. This helps to ensure that the right amount is being collected to cover expected expenses such as property taxes and insurance premiums for the upcoming year.
2. Changes in Costs: If there’s a significant increase or decrease in property taxes or insurance premiums during the year, a mid-year analysis might be conducted to adjust the escrow account. This could result in a change in your monthly mortgage payment.
3. Loan Servicing Changes: If the mortgage servicing is transferred to another company, the new servicer might conduct an escrow analysis as part of their review process.

The goal of the escrow analysis is to ensure the account has enough funds to cover the required payments without overcharging the homeowner.

After the analysis, the servicer will send the homeowner a statement showing any overages or shortages in the account, which can result in either a refund or an adjustment to the monthly payment.

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