Start with expected annual disbursements
List each escrow expense with the expected amount and payment month: property taxes, hazard insurance, and any other eligible escrow charges. Suppose taxes are $4,800 and insurance is $1,200. Expected disbursements total $6,000. A simple baseline monthly deposit is $500 before shortages, surplus adjustments, or other permissible adjustments.
Build a monthly trial balance
- Enter the opening escrow balance.
- Add scheduled borrower deposits in their expected months.
- Subtract estimated payments in the correct disbursement months.
- Review the lowest projected monthly balance and determine any permissible target cushion.
- Apply applicable shortage, surplus, and deficiency treatment before issuing the annual statement.
Download the free 12-month worksheet CSV to map deposits and disbursements. It does not automatically perform a compliant aggregate analysis.
What does RESPA say about escrow cushions?
For covered mortgage escrow accounts, Regulation X (12 CFR 1024.17) generally limits a servicer's required cushion to no more than one-sixth of estimated annual escrow disbursements. Lower limits may apply under state law or the mortgage documents. The servicer must use the aggregate accounting method and follow annual statement and shortage/surplus rules. Review the official CFPB regulation before relying on the calculation for customer disclosures.
When to use Windows escrow software
If you prepare disclosures repeatedly, the RESPA Escrow Analysis Pro product page explains its workflow and evaluation. See also our RESPA escrow analysis guide and shortages and surpluses guide.
Repeatable Windows software
Evaluate programs designed to save and document recurring work.
Browse Windows software →Updated October 24, 2026