How to Get Money Back Early from Your Yearly Escrow Statement

It's that time of year when we start preparing for T-Day (taxes). You will soon be getting all your important documents in the mail if you haven't already. Actually, by law documents should be out no later than January 31st. One of those documents will be our 1098 Mortgage Interest Statement. The Mortgage Interest Statement shows how much of the mortgage interest was paid. In addition, on the Mortgage Interest Statement, most lenders attach a breakdown of your taxes, insurance, principal activity, and escrow activity for the year. The average person just takes what they need from the Mortgage Statement which is your interest and taxes without any regard to checking amounts that are given. However, I want to point something out to you regarding your escrow amount that might give you some extra cash if you qualify.

This year I received my Mortgage Interest Statement and noticed a large surplus in my escrow in addition I noticed my interest was actually higher than last year's interest and I have a 30 year fixed conventional mortgage. That shouldn't happen. I'll discuss what happened to the interest part later. Normally, I watch this because I have learned that you can request money from your lender if there is too large of a surplus in your escrow. However, most times when you get a customer service rep they will give you some jaw boning telling you that they review it once a year and if they find a surplus or deficit they adjust it. They expect you to say, ok, "thank you". I'm here to tell you that you can request a review early.

In my case, the customer representative told me that in June they will evaluate my escrow. When I argued that the amount in my escrow is almost the amount of my taxes already and taxes were just paid in November, he just replied "well they have to consider your hazard insurance and if you pay mortgage insurance premiums". It took me a few times to convince the rep that it was still to high and I demand a review now. So, he complied and told it will take two weeks for the review and if they do find a surplus, they will send it to me.