Escrow Overcharge Estimator
The federal Real Estate Settlement Procedures Act (RESPA — the federal escrow-cap rule) caps the escrow cushion (the buffer the servicer holds beyond what's needed) at two months of escrow payments. No state allows more. The most common overcharge isn't a violation of that cap, though — it's a manufactured shortage, where the servicer projects bills higher than your actual annual disbursements and collects the difference. This calculator compares your monthly escrow against the math your servicer is supposed to be doing.
From your most recent escrow analysis or county tax bill.
Annual premium for hazard insurance (and flood, if escrowed).
Skip if you have no mortgage insurance. FHA loans pay MIP (FHA mortgage insurance) here.
The escrow portion of your monthly mortgage payment — not the full PITI (principal, interest, taxes, insurance).
From your last mortgage statement.
RESPA, the federal escrow-cap rule, allows up to 2 months. Above that, the servicer must refund or credit the excess.
You're paying $100 more per month than the math requires. Request a written escrow analysis from your servicer and file a QWR (qualified written request — the formal letter a servicer must respond to) under RESPA § 6 if they don't correct it.
$1,200 annual overcharge
- Property tax
- $4,800
- Insurance
- $3,600
- PMI / MIP
- $1,800
- Required monthly
- $850 / mo
- Max allowed balance
- $2,550
- Cushion (legal)
- $1,700
- Excess balance
- $850
Free during pilot
What RESPA actually requires
Under 12 CFR § 1024.17 (RESPA's escrow rule), your servicer can only collect what's needed to pay your annual property tax, hazard insurance, and mortgage insurance — plus a cushion of at most one-sixth of the annual disbursements, i.e. two months of escrow payments. Any state-specific rule that's stricter wins. No state allows more than two months.
The required monthly escrow is straightforward:
Required monthly = (Annual tax + Annual insurance + Annual MI) / 12
And the maximum balance the account is ever allowed to reach (specifically, the lowest projected balance during the year, plus the cushion) is:
Max balance = Monthly required + (Cushion months × Monthly required)
How servicers actually overcharge
- Tax over-projection. They estimate next year's tax bill above the actual assessed amount (often the prior year's bill times an arbitrary growth factor) and collect the difference.
- Insurance over-projection. They use the highest premium quote on file rather than your current declarations page.
- PMI miscalculation. They keep collecting PMI past the 78% automatic-cancellation point or the 80% borrower-request point under the Homeowners Protection Act.
- Cushion creep. A 2.5- or 3-month cushion shows up on the analysis. This violates RESPA's two-month cap; a written objection usually fixes it within the next analysis cycle.
What to do if you find an overcharge
- Pull your last Annual Escrow Account Statement (servicer must send one within 30 days of the escrow year end).
- Cross-check the projected disbursements against your actual property tax bill and insurance declarations page.
- If the math doesn't agree with the statement, send a Qualified Written Request (QWR) under RESPA § 6 to the servicer's designated address. They have 5 business days to acknowledge and 30 business days to substantively respond.
- If they don't correct it, you can file a complaint with the CFPB or your state attorney general.
What this calculator doesn't model
- Disbursement timing. Real escrow analyses look at the projected lowest balance over the 12-month cycle, not the average. If you're close to the cap, timing matters.
- Prior-year shortage or surplus. A real analysis rolls these into the next year's required deposit.
- Flood, wind, and umbrella escrows. If multiple insurance lines are escrowed, sum them into the annual insurance field.
Frequently asked questions
What is an escrow account and why does my servicer hold money in it?
Your escrow account is a separate pot of money your loan servicer — the company that collects your mortgage payment — holds to pay your property taxes and homeowners insurance on your behalf. Each month, part of your mortgage payment goes into this account. Federal law (RESPA — the Real Estate Settlement Procedures Act) governs how much the servicer is allowed to hold.
How much cushion is my servicer legally allowed to keep in my escrow account?
Under the federal RESPA escrow rule (12 CFR § 1024.17), your servicer can hold a cushion — a buffer above what's needed to cover your next bills — of at most two months' worth of escrow payments. No state allows more. This calculator compares what you're being charged against the RESPA-required amount so you can see whether the cushion is within legal limits.
What should I do if this calculator shows I'm being overcharged?
The first step is to pull your Annual Escrow Account Statement — your servicer must send one within 30 days of the escrow year end — and compare the projected disbursements against your actual tax bill and insurance declarations page. If the math doesn't match, you can send a written Qualified Written Request (QWR) to your servicer's designated mailing address. Under RESPA § 6, they must acknowledge it within 5 business days and respond within 30 business days. This calculator flags potential discrepancies; it is not an audit and does not constitute legal advice. If your servicer disputes your claim, consider filing a complaint with the CFPB or consulting an attorney.
What is a Qualified Written Request (QWR)?
A QWR — Qualified Written Request — is the formal letter a homeowner sends to their mortgage servicer when they believe there's an error on their account. Under RESPA § 6 (12 U.S.C. § 2605(e)), the servicer must acknowledge it within 5 business days and provide a substantive response within 30 business days. To count as a QWR, the letter must be in writing, include your name and account number, and describe the specific error or information you're requesting. The servicer is not allowed to report negative credit information related to the disputed item while it's under review.
Estimates only — not an audit, not a refund claim, and not legal advice. Real escrow analyses also account for the timing of disbursements (the lowest projected balance during the year), prior year shortages, and any servicer cushion below the 2-month RESPA cap. If this calculator flags an overcharge, the right next step is to request a written escrow analysis from your servicer and, if they don't correct it, send a Qualified Written Request under RESPA § 6 (12 U.S.C. § 2605(e)). Methodology last reviewed: May 26, 2026.