On one of our accounts the escrow surplus is $50.03 - i understand we are required to refund anything in excess of $50 to the customer - but $.03 - the stamp costs more. Is there a "under $1 rule" or something that we can keep this in the account rather than sending a check for .03.

The amount of the surplus is $50.03, not $0.03. The rule requires you to refund the entire surplus if it is in excess of $50 - not just the amount that exceeds $50 (assuming the borrower is current on their payments). You need to send the borrower a check for $50.03.

See 3500.17(f)(2)

The refund threshold is >= $50.

(2) Surpluses. (i) If an escrow account analysis discloses a surplus, the servicer shall, within 30 days from the date of the analysis, refund the surplus to the borrower if the surplus is greater than or equal to 50 dollars ($50). If the surplus is less than 50 dollars ($50), the servicer may refund such amount to the borrower, or credit such amount against the next year's escrow payments.

Thanks for the clarification.

so, the surplus is $50.03 - therefore, we are required to refund the entire amount and send a check in the amount of $50.03.

Correct?

Correct.

FWIW, Correct.

I will third that, but also add if the surplus is $50.00 even then you would need to also refund the $50.00. If the surplus is $49.99 then you have the option to refund it or apply it to the next computation year.