Mortgage Servicing Escrow Accts Deficiencies Shortages Surpluses 1 – What is a deficiency?

Compliance > Regulation X and Z - Servicing
Q:   What is a deficiency?
A:   (UPDATED 6/2/2021): A deficiency is the amount of a negative balance in an escrow account. 12 CFR § 1024.17(b).
For more information on deficiencies, see Escrow Accounts: Deficiencies, Shortages, and Surpluses Questions 7, 8, and 9.
This Q&A was contained in the CFPB’s Mortgage Servicing FAQs – version 3, as of June 2, 2021 (which may be updated from time to time).  This may be found on the CFPB’s website here:

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