If I do not want my surplus refunded, can I keep it in my mortgage escrow account?

Great question! It’s an account used to pay for items related to your property, such as taxes and insurance, and is a calculated portion of your monthly mortgage payment.

We’re happy to provide some feedback on this! An escrow analysis is an annual evaluation by your bank to determine if you’re paying the right amount in taxes and insurance for your mortgage escrow account, which can result in changes to your monthly payment.

Great news! There is no fee. Mortgage escrow accounts are maintained free of charge.

Your mortgage escrow payment is composed of three portions:

1. The anticipated amount needed to make your tax and/or insurance payments in the coming year.
2. A cushion to cover two months of anticipated payments.
3. Catch-up amounts for a shortage (if applicable). A shortage occurs when the amount that was paid for taxes and/or insurance increased from what was anticipated. The anticipated amount is always the amount of the prior year’s payments.

We’re happy to help provide some clarity here! Some mortgage loans are required to have an escrow account, including the tax and/or insurance payments. Please contact us to discuss your options.

In general, any of the below conditions require you to have a mortgage escrow account:

• If your loan-to-value (LTV) is over 80%
• If your mortgage loan has an active private mortgage insurance (PMI) policy
• If your mortgage loan has rural housing insurance
• If you have a VA mortgage loan
• If you have an FHA mortgage loan
• If you have any late credit payments within the last 12 months
• If your mortgage loan has required flood insurance, you must escrow for both the flood and homeowner's insurance