Escrow facts & stats

Question 1

Under federal rules, a servicer's regular monthly escrow charge can be up to what fraction of the year's expected escrow bills?

Accepted Answer

one-twelfth (1/12). Escrow accounts typically cover property taxes and homeowners insurance, which can change from year to year.

Question 2

At least how long before closing must a lender give you the Closing Disclosure for a mortgage?

Accepted Answer

at least three business days. The window lets buyers compare final terms and costs against the Loan Estimate they got earlier.

Question 3

If an annual escrow analysis finds a surplus of at least how much, the servicer must refund it within 30 days?

Accepted Answer

$50. For surpluses under $50, the servicer can refund the money or credit it toward next year's escrow payments.

Question 4

For a higher-priced mortgage loan, how soon after closing can the borrower ask to cancel the required escrow account?

Accepted Answer

no earlier than five years after consummation. Other conditions apply too, such as the unpaid balance falling below 80% of the property's original value.

Question 5

To cancel a higher-priced mortgage's escrow account, the unpaid principal must be below what share of the home's original value?

Accepted Answer

less than 80%. The request also can't be granted until at least five years after the loan was consummated.

Question 6

When an escrow account is required for a loan, how long does the servicer have to give the borrower the initial escrow statement?

Accepted Answer

at settlement or within 45 calendar days. It must show the monthly payment, the portion going into escrow, and itemized estimates of taxes, insurance premiums and other charges.

Escrow facts & stats

The basics