Setting Up Escrow Processing

If selected, the system makes a deposit to the member's escrow account from the member's loan payment.

(Portico Host: 962 Transaction - ESCROW LOAN SUPPORT field)

If selected, the system will print the V07 message detail on the annual disclosure or short year statement. The V07 message detail allows you to alert your member that there could be a change to the monthly principal and interest amount on a variable rate loan due to the terms of the loan. This situation could occur if the member's escrow loan payment type was 06 or 09. You must set up the V07 message detail using the Notice Messages window.

(Portico Host: 962 Transaction - MSG PRINT field)

Specifies if the system updates the member’s payroll distribution when escrow recalculation changes the loan payment amount. Valid values are:

Y - Update the payroll distribution.

N - Do not update the payroll distribution. System default.

Specifies if the system resets the Next field on the Loans – Escrow Info tab when a short year statement is generated. The system produces a short year statement when the loan matures, is paid off, or transferred; or when the Recalculate field is Y on the Loans – Escrow Info tab. Valid values are:

Y - Reset the Next field 12 months in the future.

N - Do not reset the Next field when a short year statement is generated. System default.

Indicates the inflation factor which is calculated by dividing the current consumer price index (CPI) by last year’s CPI. The system applies this factor to an escrow item with I in the Next Period Calculation Option field on the Loan Escrow Item dialog box.

Example: Last year’s school tax bill was $827, the current CPI (September 1994) is 149.4 and the CPI in September 1993 was 145.1. The inflation factor is 1.02963 and the projected school tax will be $851.51. ((149.4/145.1) X 827 = 851.51)

Note: Portico will not calculate the factor for you. This is a credit union-defined field and must be updated monthly if I appears in the Next Period Calculation Option field for an escrow item.

Indicates the type of cushion amount that must be on deposit in the member’s escrow share account for the analysis period. Valid values for required deposits are:

0 - No reserve or cushion required

1 - One month cushion required. This will be 1/12 of the annual escrow amount for all items, excluding item zero (0).

2 - Two month cushion required. This will be 1/6 of the annual escrow amount for all items, excluding item zero (0). System default.

F - A flat amount required. This amount cannot be greater than 1/6 of the annual escrow amount for all items. If it is, the system will recalculate the escrow account using the 1/6 amount and will produce the annual disclosure statement. The system also will include the account as an exception on the 465 Report.

P - Percentage of the annual escrow amount required. The amount calculated cannot be greater than 1/6 of the annual escrow amount for all items. If it is, the system will recalculate the escrow account using the 1/6 amount and will produce the annual disclosure statement. The system also will include the account as an exception on the 465 Report.

The option in the Default Cushion Calc field is the default option on the New Loan - Escrow Information tab.

The percentage rate of the annual escrow amount to be used to calculate the cushion amount if P appears in the Option fields in the Current Period Cushion or Next Period Cushion group box on the Loans – Escrow Info tab. The option in the Percent field is the default option on the New Loan - Escrow Information tab.

The flat amount to be used as the cushion amount when F appears in the Option fields in the Current Period Cushion or Next Period Cushion group box on the Loans – Escrow Info tab. The option in the Flat Amount field is the default option on the New Loan - Escrow Information tab.

Indicates the method to be used to recalculate each escrow item at the time of escrow recalculation for the current period. Valid values are:

L - Use last year’s amount in the Disbursement Current Period field on the Loan Escrow Item dialog box. If zero, the system uses the amount in the Current Period Total Amount field on the Loan Escrow Item dialog box to recalculate the escrow item. If the Current Period Total Amount field is zero or on a new escrow item, the system uses the amount you enter in the Next Period Total Amount field on the Loan Escrow Item dialog box. System default.

I - Use the inflation factor (Consumer Price Index (CPI) factor) for recalculation. Apply the factor to last year’s amount in the Disbursement Current Period field. If that field is zero, the system will apply the factor to the amount in the Current Period Total Amount field for recalculation of the escrow item. If the Current Period Total Amount field is zero or on a new escrow item, the system will use the amount you enter in the Next Period Total Amount field.

K - Use the known amount in the Next Period Total Amount field.

D - Discretionary item. The system uses the amount in the Next Period Total Amount field on the Loan Escrow Item dialog box in the recalculation process. Refer to the RESPA ruling for information on discretionary items. Discretionary items are not included if the report is run on request.

The option in this field is the default option on the Loan Escrow Item dialog box.

Indicates whether a mass analysis occurs, and if so, what is the beginning month of the new analysis period. The valid values are:

00 - A mass analysis should not occur. The next analysis date for the new loan comes at the first payment date plus 12 months. Subsequent analysis automatically occurs in 12 month intervals.

Example: If the first payment for the new loan is due on 09/01/12, the system sets the next analysis date to 09/13. The next analysis occurs during the 07/13 month-end back-office cycle. The system changes the payment amount, if necessary, during the 08/13 month-end back-office cycle. The new payment amount appears on the Loans tab on 09/01/13. All of the information in the Next Period group box on the Loan Escrow Item dialog box will appear in the Current Period group box.

01-12 - A mass analysis occurs two or three months prior to the month specified in this field.

Example: If 01 appears in this field and the Analysis Verification Months field is 1, the mass analysis will occur for all loans during the 11/12 month-end back-office cycle. The system changes the payment amount(s), if necessary, during the 12/12 month-end back-office cycle. The new payment amount(s) will appear on the Loans tab on 01/01/13. All of the information in the Next Period group box on the Loan Escrow Item dialog box will appear in the Current Period group box.

The option selected in this field is the default option for the Next field on the Loans – Escrow Info tab. The actual date analysis occurs is based on that field.

Indicates which payment amount the system should print on the annual disclosure statement when the member has a surplus in the escrow account that is less than the amount specified in the Min Amt To Refund Surplus field on the 465 Report Rules. Valid values are:

N - Print only the new payment amount adjusted by the surplus amount.

Y - Print the new payment amount adjusted by the surplus amount and the payment amount not adjusted by the surplus amount. System default.

Specifies which payment amount the system should print on the annual disclosure statement when the member has a shortage in the escrow account that is less than one month’s escrow payment. Valid values are:

N - Print only the new payment amount adjusted by the shortage amount.

Y - Print the new payment amount adjusted by the shortage amount and the payment amount not adjusted by the shortage amount. System default.

Indicates which payment amount the system should print on the annual disclosure statement when the member has a deficiency that is less than one month’s escrow payment. The valid options are:

N - Print only the new payment amount adjusted by the deficiency amount.

Y - Print the new payment amount adjusted by the deficiency amount and the payment amount not adjusted by the deficiency amount. System default.

Indicates which payment amount the system should print on the annual disclosure statement when the member has both a shortage and a deficiency that are less than one month’s escrow deposit. The valid options are:

N - Print only the new payment amount adjusted by the aggregate amount of the shortage and the deficiency.

Y - Print the new payment amount adjusted by the aggregate amount of the shortage and the deficiency and the payment amount not adjusted by the aggregate amount. System default.

Indicates the lowest surplus amount allowed. Surplus amounts equal to or greater than $50 must be refunded to the member. However, you may choose to refund all surplus amounts. Valid values are:

00.00-50.00 The lowest surplus amount your credit union allows

50.00 System default

Indicates the number of months your credit union has to verify the escrow analysis results before the values from the Next Analysis Period fields are moved to the Current Analysis Period fields. The valid options are:

1 - Your credit union has one month to make any corrections or adjustments to the values in the Next Analysis Period fields for escrow in the recalculate status. For example, the escrow account is analyzed in the June month-end cycle. You make adjustments during the month of July and the values are applied in the July month-end cycle. System default.

2 - Your credit union has two months to make any corrections or changes to the values in the Next Analysis Period fields for escrow in the recalculate status. For example, the escrow account is analyzed in the June month-end cycle. You make adjustments during the months of July and August, and the values are applied in the August month-end cycle.

The first of two lines comprising the credit union’s address. The system uses each of the address fields on the Credit Union Profile – Credit Union tab if an address does not appear on the 465 Report Rules.

The city the credit union resides in.

The abbreviation code of the state where the credit union resides.

The ZIP Code for the credit union.

The credit union’s telephone number (3 digit area code and 7 digit phone number).