I am looking at a loan that has not had any projections since 2010. This loan has a shortgage of $2700.00 resulting in an increase of $300.00 for the monthly escrow payment. It looks like this loan has had a negative escrow balance for a long time because it has never adjusted for any increases in taxes/insurance. Another problem I found is this loan has not had an analysis generated since 2009. That's a another story I won't go into here. To me this is going to be a payment shock to the borrower and I am wondering if the customer can afford such an increase. Any suggestions of what the bank should do?

Sounds like the bank has failed to meet its regulatory requirements under RESPA.

Offer the borrower a no fee low interest loan to pay the shortage. Then be sure the required annual analysis is ran going forward.

Dan you are right bank is really out of compliance with RESPA.
Thanks.

You may need to check your settings with your processor. I know we ran into this problem awhile ago. I can't recall the exact problem we had but it was due to coding. Luckily for us, we only had a handful of loans that hadn't gone through analysis. If your system will allow, you should try to pull a report to identify any other loans that have not had analysis in over a year.