Math worksheet · Free download
Escrow Cushion Audit Worksheet
Estimate the annual escrow disbursement total and compare the statement’s projected low balance with the federal maximum cushion concept.
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Actual first-page previewEscrow Cushion Audit Worksheet
Before you fill it out
What this resource helps you document
Estimate the annual escrow disbursement total and compare the statement’s projected low balance with the federal maximum cushion concept.
01Annual projected disbursements
02One-sixth cross-check
03Projected low balance
04Timing notes
05Questions to ask
Federal baseline to check
Use the form with the rule, not instead of the rule.
These templates organize facts and records. They do not create a borrower right that the underlying regulation, loan terms, investor rules, or state law does not provide.
- The federal maximum cushion is generally no more than one-sixth of estimated annual escrow disbursements, roughly two months of escrow payments.
- The federal rule sets a maximum, not a required cushion; a servicer can use a smaller cushion or no cushion.
- Loan documents or applicable state law can impose a lower permissible cushion, and the lower limit controls when applicable.
Use this resource carefully
- Use total projected annual disbursements, not the total mortgage payment, to calculate the one-sixth cross-check.
- Compare the projected lowest month-end balance with the selected cushion after the full trial balance is considered; a single snapshot balance can be misleading.
- If the mortgage documents state a lower reserve, preserve that clause and compare it with the amount used in the analysis.