What is included in the initial escrow disclosure?

The initial escrow disclosure includes information on how escrows are collected and outlines the responsibilities of the servicer. This document is crucial as it helps borrowers understand the escrow process, including how much money will be set aside for property taxes and insurance. It details when and how those funds are collected and what the servicer’s obligations are in managing those funds. Understanding this information is vital for borrowers, as it provides clarity on the projected monthly payments and the management of their escrow account.

While the interest rate details, breakdown of mortgage insurance, and total estimated closing costs are important components of the loan process, they are not contained within the initial escrow disclosure. Instead, they may be covered in other disclosures related to the loan agreement and closing documentation. The focus of the initial escrow disclosure is solely on the mechanics and responsibilities regarding the escrow account.