An escrow (also called an impound) account is a separate account we use to hold funds for your property taxes and insurance. If your loan includes escrow, a portion of your monthly mortgage payment is deposited into this account.
We then use these funds to pay your property tax and insurance bills on your behalf—so you don’t have to worry about saving for these expenses or tracking due dates.
Important: Your escrow balance cannot be used to cover other amounts you owe, such as mortgage payments, fees, or corporate advances.
In many cases, an escrow account is required as part of your loan agreement or modification and will be outlined in your loan documents.
If your loan was transferred to us and you had an escrow account with your previous servicer, it was transferred as well.
We may also add an escrow account if we pay your delinquent property taxes or purchase homeowners insurance due to a lapse or insufficient coverage.
Note: If escrow is added for these reasons, it usually cannot be removed later.
Your Options:
♦ If you don’t have an escrow account, you can request to add one.
♦ If you have an escrow account and want to remove it, you can submit a removal request.
Please note: All requests are subject to eligibility requirements.
Having an escrow account is all about convenience. It ensures you never have to worry about property tax and insurance due dates, because we make those payments for you.
On the other hand, removing your escrow account means we will no longer pay your property taxes or insurance, and we will stop collecting the escrow portion of your monthly payment.
Benefits:
♦ Keeps more money in your account, which you may use to earn interest.
♦ Gives you full control over what is paid and when.
Drawbacks:
♦ You’ll need to budget for large, lump-sum property tax and insurance bills.
♦ If payments are late or missed, you’ll be responsible for penalties or fees.
Important: Please note that mortgage insurance (PMI/MIP) is separate from homeowners insurance and must remain escrowed until your loan meets specific requirements.
Eligibility depends on your loan details and state regulations, so the best way to confirm is to contact us at escrow@admortgage.com. General requirements may include:
♦ Escrow waiver fee based on the original loan amount.
♦ The loan must be current.
♦ The loan must be at least 60 months (5 years) old from the date of funding.
♦ LTV is less than 80%.
♦ No 30-day late payments in the past 24 months and 60-day late payments in the past 36 months.
♦ The loan was not modified for loss mitigation.
♦ The loan is not active in bankruptcy.
♦ The loan does not have Forced-Placed Insurance.
♦ The loan does not have active Mortgage Insurance.
♦ There is no negative escrow balance on the loan.
♦ All taxes and insurance must be current.
♦ There are no upcoming tax or insurance disbursements within the next 60 days.
Send a written request to escrow@admortgage.com, including your loan number in the subject line.
Processing time: 7–15 business days.
Next Steps:
♦ Status updates will be sent via email.
♦ If Approved:
◊ Updates will appear in your online account within 24 hours.
◊ You’ll receive a confirmation letter with your new monthly payment and effective date.
◊ We’ll notify you if you have an escrow surplus refund.
Important: If your home insurance is removed, notify your insurance company that you’ll make payments directly.
◊You must still inform us of any insurance changes and provide the mortgagee clause.
♦ If Denied: You’ll receive a letter explaining the reason(s).
If you change your mind, it takes about 30 calendar days to reopen an escrow account after you sign and return the agreement.
Important: You must pay any property taxes or insurance premiums due within the next 60 days to avoid missed payments.
Until the account is re-established, you are responsible for paying all escrow items.
In most cases, if you make a down payment of at least 20%, you are not required to carry mortgage insurance.
♦ If you are required to have mortgage insurance, it may be removed once your home equity reaches a certain percentage.
Note: Depending on your loan type, mortgage insurance may be called Private Mortgage Insurance (PMI) or Mortgage Insurance Premium (MIP).
If you’re required to carry PMI, we will automatically cancel it when your loan-to-value (LTV) ratio reaches 78%.
Example:
If you borrow $85,000 to buy a home appraised at $100,000, your LTV is 85% (85,000 ÷ 100,000 = 0.85).
Based on your original property value and loan terms, we project the date when your LTV will reach 78%, and PMI will be canceled on that date.
Important: This automatic cancellation date is fixed and cannot be moved up.
You can request early cancellation before the automatic termination date if:
♦ Your property has at least 20% equity (80% LTV).
♦ Your loan is current.
♦ No 30-day late payments in the past 12 months.
♦ No 60-day late payments in the past 24 months.
If you haven’t reached 80% LTV, we may order an official appraisal to confirm your property value.
♦ Appraisal must occur within 90 days of your request.
♦ You are responsible for the appraisal cost.
To request PMI cancellation email escrow@admortgage.com with:
♦ Explicit request to cancel PMI
♦ Loan number
♦ Date
♦ Signatures of all borrowers
Note: The requirements for removing PMI are complex and depend on multiple factors. Please contact us to review your options.
The minimum required balance is the lowest positive balance that must remain in your escrow account at any time. This is also called the escrow cushion requirement.
It helps us reduce the impact on your monthly mortgage payment if property tax or insurance rates increase.
Under federal law, your escrow balance cannot drop below 1/6 of the anticipated annual disbursement, unless your mortgage contract or state law allows a lower amount.
Example:
If you’re required to deposit $500 per month into escrow, your minimum required balance (cushion) could be $1,000.
An escrow account offers convenience by ensuring you never have to worry about property tax and insurance due dates, because we handle those payments for you.
You can request an escrow account by:
♦ Emailing us at escrow@admortgage.com
♦ Mailing a letter to:
899 W Cypress Creek Rd, Fort Lauderdale, FL 33309
♦ Sending a fax to (877) 903-2967
Note: This process can take up to 45 calendar days.
♦ We’ll send you a projection of future escrow disbursements , including your new monthly payment amount.
♦ You’ll need to confirm this so we can update your payment with the escrow portion.
♦ Your Escrow Statement will be sent:
♦ By email if you requested it or have a paperless account
♦ By mail otherwise
Important:
♦ Notify your insurance company that we will make payments going forward once the renewal invoice is provided to us.
♦ You must inform us of any insurance changes and provide the mortgagee clause to your insurance company.
If you want to remove your escrow account later , you can learn about escrow removal here.
Property tax and insurance rates can change, so sometimes we need to adjust your monthly escrow amount to make sure it covers these payments. This is one of the most common reasons your total monthly mortgage payment may change.
We conduct an Annual Escrow Analysis according to a set schedule. All loans with an anniversary date due for Escrow Disclosure are analyzed at the same time each year.
The timing of each step in this process is based on the last analysis date.
An Escrow Account Statement is mailed to you 30–45 calendar days before the Coupon Month.
What’s Included in the Escrow Account Statement?
♦ Your current monthly mortgage payment and the portion going into escrow
♦ Your previous year’s monthly payment and escrow portion
♦ The total amount paid from escrow for taxes, insurance premiums, and other charges (itemized)
♦ The escrow account balance at the end of the period
♦ A projection of receipts and disbursements for the next 12 months to determine if there is a Surplus, Shortage, or Deficiency
Shortage
A shortage means your escrow account is projected to fall below the minimum required balance in the coming year.
♦ We’ll automatically spread the shortage amount over the next 12 months and add it to your monthly payment.
Note: This is one of the most common reasons your payment may increase.
♦ You can avoid this increase by paying the shortage as a lump sum before the new payment effective date. This payment is optional and not required.
Important:
♦ Your Escrow Disclosure Statement will show the exact month(s) when your account falls below the minimum required balance.
♦ Even if you pay the shortage in full, your monthly payment may still increase if property taxes or insurance premiums have gone up.
A surplus means your escrow account has more funds than needed.
♦ If an Escrow Analysis shows a surplus of $50 or more, you’ll receive a refund within 30 days of the analysis date.
♦ If your account is delinquent, the surplus will remain in escrow for future disbursements.