Mortgage Servicing Escrow Accts Deficiencies Shortages Surpluses 2 – What is a shortage?

Compliance > Regulation X and Z - Servicing
Q:   What is a shortage?
 
A:   (UPDATED 6/2/2021): A shortage is an amount by which a current escrow account balance falls short of the target balance at the time of escrow analysis. 12 CFR § 1024.17(b).
 
For more information on shortages, see Escrow Accounts: Deficiencies, Shortages, and Surpluses Questions 4, 5, and 6.
 
 
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:  https://files.consumerfinance.gov/f/documents/cfpb_mortgage-servicing_frequently-asked-questions.pdf
 

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