Escrow Troubleshooting

The following section contains answers to commonly asked questions regarding Escrow Processing.

Paying a Shortage Up Front

Question: How do I pay a shortage up front?

Answer: If the escrow account has been recalculated, but the system has not yet changed the loan payment amount or transferred the information in the Next Analysis Period group box to the Current Analysis Period group box (status R), complete the following steps:

Access the Loan Escrow Item dialog box for escrow number 0 by typing 0 in the Escrow Number field and pressing ENTER.
Type 0.00 in the Next Analysis Period Total Amount field and press ENTER.
Deposit the shortage amount into the escrow share type indicated on the Loan Escrow Item dialog box.

If the escrow account has been recalculated, the loan payment amount changed, and the information in the Next Analysis Period group box has been transferred to the Current Analysis Period group box (status C), complete the following steps:

Access the Loan Escrow Item dialog box for escrow number 0 by typing 0 in the Escrow Number field and pressing ENTER.
Type 0.00 in the Current Analysis Period Total Amount field and press ENTER to lower the payment amount on the Loans tab.
Deposit the shortage amount into the escrow share type indicated on the Loan Escrow Item dialog box.

Correcting Portion of Payment

Question: How do I correct the Portion of Payment field or the Current Analysis Period Total Amount field on the Loan Escrow Item dialog box after escrow analysis has been completed?

Answer: If a member has gone through escrow recalculation and the Portion of Payment and Current Analysis Period Total Amount fields are incorrect and the escrow account has been recalculated, the loan payment changed, and the information in the Next Analysis Period group box has been transferred to the Current Period group box (status C), enter the correct amount in the Portion of Payment field. You cannot modify the Current Analysis Period Total Amount field.

Re-Process a Member Through Escrow Analysis

Question: How do I re-process a member through escrow analysis?

Answer: You can complete this process if the escrow account has been recalculated (status R or status C).

Correct the Next Period information and verify the Next Period Calculation Option field is K (use the known amount) on the Loan Escrow Item dialog box.
Select C- Recalculate tonight due to corrections from the Recalculate dropdown.
The loan will go through the recalculation process in the back-office cycle.
After Portico updates the payment amount, on the Loan Escrow Item dialog box, change the Next Period Calculation Option field back to L (use last years disbursal amount for recalculation).

Distributing a Member’s Surplus

Question: How do I give a member their surplus?

Answer: Transfer the surplus to the member’s 01 share account or any other valid share account or give the member a credit union check from the share account you transferred the funds to. Do not complete a share withdrawal by check using the escrow share type. It will require an escrow note number and escrow number and will update the disbursement bucket incorrectly on the Loan Escrow Item dialog box affecting the member’s escrow analysis next year.

Requiring an Escrow Share Type

Question: Why does the system require a different escrow share type when loan is paid off?

Answer: RESPA requires each mortgage loan to have a separate share type.

Removing Escrow from a Loan

Question: I have a member who has escrow on a loan and they no longer want the credit union to maintain the escrow account for them. How do I remove the escrow account so the member’s loan payment will no longer have the additional escrow funds?

Answer: Complete the following steps:

Go to the Loans - Escrow Info tab for the loan. Click the Details icon button for each individual escrow item, including the shortage item if there is one, and change the Payment Portion field on the item to 0.00 on the Loan Escrow Item dialog box. When you save the changes, a message will appear indicating that the payment amount is being updated.
Refresh the Loans - Payment tab for the loan and verify that the members payment amount is equal to the principal plus interest. If the payment amount is not correct and the Payment Portion field is 0.00 for all escrow items, then manually change the payment amount to the correct amount.
On the Loans – Escrow Info tab, selecting Do Not Recalculate from the Recalculate drop-down list to prevent the loan from going through the annual escrow recalculation process.

Escrow Analysis Occurred Too Early

Question: I have a member that went through escrow analysis this month, but they were not supposed to go through recalculation yet. How can I get the member back on the regular analysis schedule?

Answer:

If the escrow status is C, the member loan has already completed recalculation. At this point, you must adjust the Payment Portion field on each escrow item to bring the member's payment back to what it was before. Then, verify that the date in the Payment Analysis Next Date field on Loans - Escrow Info tab is correct annual analysis date.
If the escrow status is R, the member loan is currently in the middle of recalculation. The information in the Next Analysis Period group box will move to the Current Analysis Period group box at the end of the month. To prevent any changes to the member's loan, you must change the fields in the Next Analysis Period group box to match the fields in the Current Analysis Period group box so when the information in the Next Analysis Period group box moves to the Current Analysis Period group box, the net effect to the loan will be nothing.

Setting Up Quarterly Taxes

Question: I have a member whose taxes are due on a quarterly basis, but I do not see a quarterly frequency on the Loan Escrow Item dialog box. How do I set up quarterly taxes?

Answer: Set up an escrow item with an annual frequency for each quarter.

Accidentally Used the Insurance Escrow Item for Taxes

Question: I disbursed the tax bill for a member using the insurance escrow item and now the disbursement current period for the insurance item is not correct. I do not want to cut another check since it was correct. Is there another way for me to fix the amount in the Disbursement Current Period field?

Answer: Complete the following steps:

Use the Adjustments - Share Deposit from General Ledger tab to transfer funds from a wash general ledger to the member's escrow share account. This will reverse the funds from the incorrect escrow item. Be sure to indicate in the Statement Messages fields that the deposit is for the incorrect escrow item.
Then, use the Adjustments - Share Withdrawal to General Ledger tab to transfer the funds from the member's escrow share account to the same wash general ledger. Be sure to indicate in the Statement Messages fields that the withdrawal is for the correct escrow item.

Mysterious Shortage

Question: I have a member who has a shortage this year, but I am not sure why because the insurance and tax amounts have not changed. What things would cause this to happen?

Answer:

Verify that all items where disbursed in the month in which they were projected for. If they were disbursed earlier or later and the withdrawal was right before the recalculation, then the projection could be miscalculated.
Verify that all the items disbursed in the past year were disbursed correctly. If you disbursed one item using the wrong escrow item, the yearly amount may appear to have increased.
Verify that the loan is not delinquent which would cause the escrow account to be behind as well.

Incorrect Information Used in Recalculation

Question: I have a member who went through recalculation, but there was incorrect information used in the recalculation. How to ensure that the new payment is correct?

Answer: If the new payment is not correct on the annual notice, then you can correct the Next Analysis Period information that will be moved to the Current Analysis Period group box at the end of the month. You can change the total amount or the disbursement dates to the correct information. At the end of the month, the system will move the corrected information to the Current Analysis Period group box and the total amount will be divided by the number of escrow payments in the year to calculate the correct Payment Portion field.

If you manually change the information, the system will not go back and generate a new disclosure or projection. In order for the system to generate a new disclosure or projection, you can change the Next Analysis Period information to match the Current Analysis Period information so the net effect at the end of the month is 0.00. Then, force the member’s loan to go back through recalculation again the next month end by selecting Y - Recalculate in next month-end back-office cycle from the Recalculate drop-down list on the Loans – Escrow Info tab.

Escrow History, But No Projection

Question: When the annual analysis was performed, we received an escrow history for a member, but not a projection. Why is there no projection?

Answer: Pull the Escrow Recalculation Report 465 for the end of the month. See if the member appears on the report with an exception code and under the member's loan information the words “Incomplete Disclosure” appear. The exception code should give you the reason why a good projection was not able to be created since there was incorrect information.

Error: Cannot Be Maintained Due To Escrow Analysis Status

Question: I am trying to change information on an escrow item, but the error message “Cannot Be Maintained Due To Escrow Analysis Status” appears. Why?

Answer: This error message appears when you are trying to change information in the Current Analysis Period group box. The only time you can change the information in the Current Analysis Period group box is if the loan has never been recalculated (escrow status N) with the exception of the expiration date. If the loan is in the middle of recalculation or has completed a recalculation cycle before, you can only maintain information in the Next Analysis Period group box and the Payment Portion field in the Payment Information group box.

Changing the Loan Payment Frequency

Question: I need to change the payment frequency on a member loan. If I change the payment frequency, will the escrow information automatically update according to the payment frequency?

Answer: The Number of Payments field will change, but it will not update the Payment Portion field. You must update this amount manually. The system will look at the number of payments per period next time recalculation occurs.

Collecting Early for Increased Taxes

Question: I have a member who we just received a tax statement and the taxes went up quite a bit. The member does not want to be extremely short next year, so how can I start collecting for this increased amount now?

Answer: You can increase or decrease the Payment Portion field on an escrow item at any time. Changing this amount will automatically adjust the member’s payment immediately. As an alternative, the member can deposit excess funds to the escrow share account anytime without changing the Payment Portion field.

Booking a Mortgage Loan Where the Default Escrow Share Type Already Exists on the Member’s Account

Question: How can I book a mortgage loan in Loancierge that has an escrow share type that already exists on the member's account?

Answer:Fiserv recommends booking the mortgage loan in Portico instead of in Loancierge. Portico will allow you to choose the escrow share from a drop-down list of eligible escrow share types when booking the loan. The loan status in Loancierge can then be changed to Booked Offline.

An alternate work-around is to submit a request to Portico Client Services asking to have the escrow share type changed on the Loan Profiles - Additional Information tab for the loan type. The loan can then be booked in Loancierge. The new escrow share account will be added to the member’s account and the loan will be booked. The new escrow share account can be closed if it is not going to be used; however, it will not purge off the account until the loan is paid off and purges off the system. Then another request would be made to Portico Client Services to change the escrow share type on the Loan Profiles - Additional Information tab back to the original escrow share type.