As it relates to mortgage loans, an escrow account is for the purpose of collecting funds monthly from the borrower for payment of taxes, insurance, and other escrow items. The servicer pays these items as they become due using the funds in the escrow account. The amount of the monthly escrow deposit is determined at loan origination using the latest figures available. An initial deposit is collected at loan closing and thereafter, monthly deposits are made to the account as part of the monthly mortgage payment. In theory, this sounds simple; however, anyone who has worked in an Escrow Department of a mortgage-banking firm knows this is a difficult task.

AllRegs Academy’s Escrow Analysis Practical Guide helps to demystify the process by focusing on the requirements for analyzing escrow accounts using pertinent examples. In this guide, you will learn when to conduct the escrow analyses. The analysis determines what funds are in the account, and how to determine the correct amount to be collected in the monthly payment. It also establishes the monthly escrow payment amount for the borrower. Some may choose to analyze all loans at the same time once a year, while others analyze loans according to the state the property is located in. Since taxes usually represent the largest disbursement from the account, you will learn about shortages and deficiencies that usually occur with the payment of taxes.

In this searchable, online guide, you will learn about the requirements for analyzing accounts and look at examples with varying situations. The analyses are performed by the servicer's processing system; however, a good understanding of the process is essential to the Escrow and Customer Service Department's staff.