Mortgage Escrow Shortage Made Your Payment Jump? Read This Before Panicking
If an escrow shortage made your monthly mortgage payment increase, the jump usually combines two different things: the servicer may be collecting more each month for future tax or insurance bills, and it may also be collecting extra to repay a past escrow shortage. Start with the escrow analysis statement, compare last year's actual tax and insurance disbursements with this year's projections, identify any shortage or deficiency line, and ask the servicer which part of the new payment is the regular escrow deposit versus shortage repayment. Do not ignore the mortgage bill or assume refinancing is the answer; verify the statement and ask for account-specific options in writing.