How to Audit an Annual Escrow Disclosure Statement

Home ownership comes with certain responsibilities. You probably expect your lender to keep perfect records and never make mistakes, but mistakes do happen and records get misplaced. It's important to conduct due diligence by auditing statements and receipts you receive from your lender. If you have an escrow account set up to pay for property taxes and insurance, your payments are likely to change over time due to changes in the tax and insurance rates. Your lender provides an annual escrow disclosure statement to you.

Step 1

Find the escrow disclosure statement from last year. You will also need your property tax statement or bill and your insurance bills from the current year.

Step 2

Check the basic loan information on the new disclosure statement. This information includes your mortgage account information, loan balance and address. It's usually found at or near the top of the statement.

Step 3

Compare the figures from last year's statement to the "prior year" figures on the new statement. These will be found in the prior payment and new payment sections as well as the section that compares prior projections to the actual payments.

Step 4

Add the amounts disbursed out of the account, found in the actual activity section. Compare these to the property tax and insurance bills to make sure they were paid in full.

Step 5

Calculate your payments into the account and subtract the disbursements to reach an account balance. Double-check your calculations with the figures on the statement.

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