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#2076107 - 04/28/16 01:33 PM Annual Escrow Analysis - Account History
Adam F Offline
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Adam F
Joined: Apr 2013
Posts: 415
"(1) Contents of annual escrow account statement. The annual escrow account statement shall provide an account history, reflecting the activity in the escrow account during the escrow account computation year, and a projection of the activity in the account for the next year. In preparing the statement, the servicer may assume scheduled payments and disbursements will be made for the final 2 months of the escrow account computation year."

I have a question concerning the above statement. I am reviewing an annual escrow analysis that was completed about a month before the end of the computation year. The account history lists an accurate picture of what was paid into and out of the account for the previous year, but the last payment had not been paid into the account when the escrow analysis was performed. Usually our system assumes the last payment will be made; however, this time it did not. It left the last month as $0, thus the ending balance does not match the projected starting balance on the projections page.

So here is my question. The regulation states you may assume the final 2 months, but if the account history page fails to do this is it considered an error? Or is this acceptable as long as the projection page starting account balance is accurate?

Thanks in advance for your help.
It is better to act cautiously beforehand than to suffer afterward.

The answers I give are my opinions. Not legal advice.

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#2076124 - 04/28/16 02:32 PM Re: Annual Escrow Analysis - Account History Adam F
rlcarey Offline
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Joined: Jul 2001
Posts: 81,346
Galveston, TX
The balance carried forward has to balance.
The opinions expressed here should not be construed to be those of my employer:

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#2076158 - 04/28/16 04:05 PM Re: Annual Escrow Analysis - Account History Adam F
David Dickinson Offline
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David Dickinson
Joined: Nov 2000
Posts: 18,762
Central City, NE
I agree. If you're going to cut annual statements before the anniversary of the escrow account computation year, then you must assume all normal in and out flows. If the last payment (in-flow) is not shown, the statement is not accurate.
David Dickinson

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#2080056 - 05/24/16 04:59 PM Re: Annual Escrow Analysis - Account History David Dickinson
SallyGirl Offline
Joined: Aug 2014
Posts: 82
My question deals with the Initial Escrow Account Disclosure Statement. If the flood policy and hazard policy period begins January 6, 2016 shouldn't the Initial Escrow Account Disclosure reflect these payments will be disbursed in December 2016 for the following policy period, not in January 2017? If this is the case, then the initial escrow payment at closing would be short, right?

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