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/u/AdFit570
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I’m looking for some input/advice on my escrow account balance vs. the cushion that has been selected by my servicer. Also, I’m typing this on my phone so please forgive any errors or repeats.
I just received my annual escrow disclosure statement for 2025 (Feb 2025 - Jan 2026). On the disclosure it is stated that the cushion that has been selected by my servicer (Northwest Bank) is $1,056.29. This number makes sense as the projected payments into my escrow for 2025 is $528.14, which lines up the cushion to be 1/6th that of the payments into my escrow.
Now, where I’m confused is the cushion vs. my beginning balance for 2025 on the disclosure. My beginning balance is $3,167.95, essentially 3x the selected cushion. My understanding is that the 1/6th cushion is federally regulated, and yet my balance is 3 times higher going into the year.
On top of this, I had private mortgage insurance removed from my loan last year (house is well above 80% LTV at this point), and as a result they are raising my monthly payment by $31.34 to cover a “shortage”. In reality, it looks like they never adjusted my escrow projection for 2024 after removing PMI, mind you my payment dropped when doing so, and now are wanting me to make up the difference for their mistake.
My two questions here are:
Appreciate any advice/input you can provide.
Quick Edit: I have been thinking about closing my escrow lately and managing my taxes/home owners insurance on my own, which I know could alleviate all of these problems in the future. However, I don’t want to put that burden of financial planning on myself until the rest of my consumer debt (student loans and auto loan) are paid off.
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Input Needed on Escrow Balance vs. Cushion Selected by Servicer
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I just received my annual escrow disclosure statement for 2025 (Feb 2025 - Jan 2026). On the disclosure it is stated that the cushion that has been selected by my servicer (Northwest Bank) is $1,056.29. This number makes sense as the projected payments into my escrow for 2025 is $528.14, which lines up the cushion to be 1/6th that of the payments into my escrow.
Now, where I’m confused is the cushion vs. my beginning balance for 2025 on the disclosure. My beginning balance is $3,167.95, essentially 3x the selected cushion. My understanding is that the 1/6th cushion is federally regulated, and yet my balance is 3 times higher going into the year.
On top of this, I had private mortgage insurance removed from my loan last year (house is well above 80% LTV at this point), and as a result they are raising my monthly payment by $31.34 to cover a “shortage”. In reality, it looks like they never adjusted my escrow projection for 2024 after removing PMI, mind you my payment dropped when doing so, and now are wanting me to make up the difference for their mistake.
My two questions here are:
Do I have some leg to stand on in trying to pull the roughly $2,000 overage out of my escrow to reset the cushion? This money could really help as I’m trying to pay off other debts currently.
Am I able to argue the increase to my payment citing the lack of readjustment to my escrow projection last year?
Appreciate any advice/input you can provide.
Quick Edit: I have been thinking about closing my escrow lately and managing my taxes/home owners insurance on my own, which I know could alleviate all of these problems in the future. However, I don’t want to put that burden of financial planning on myself until the rest of my consumer debt (student loans and auto loan) are paid off.
submitted by /u/AdFit570
[link] [comments]
Input Needed on Escrow Balance vs. Cushion Selected by Servicer
Continue reading...