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Explanation of Statements
The Escrow Analysis Statement is divided into three sections, which explain the escrow activity and how your monthly payment is determined.
Section 1:
This section is a comparison of your current and new payment amount of principal and interest, total escrow deposit, and repayment of any shortage that may exist.
Section 2:
This section lists a 12-month running escrow balance to determine the appropriate target balance, and to determine if a shortage or surplus may exist. This is a projection of the activity in your escrow account for the following 12 months.
This section also included the optional shortage payment coupon in the event of a shortage, so that you may repay the shortage in one lump sum if you wish. The shortage repayment is automatically prorated over a 12-month period and is included in the payment that is listed on the Escrow Analysis Statement. If you repay the shortage in full, you payment will be reduced to reflect the difference of the shortage-spread amount. If you have a surplus greater than $50.00 and your account is current, a check will be attached to this portion instead of a shortage coupon.
Section 3:
This section is a review of the actual activity in your escrow account since your last analysis.
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