How to use this calculator
- Enter your annual property tax bill and annual homeowners insurance premium.
- Optionally add a monthly amount such as HOA dues or mortgage insurance to see it alongside escrow.
- Set the cushion in months. The estimate is limited to two months.
What the results show
- Monthly property tax, monthly insurance, and the combined monthly escrow deposit.
- The estimated maximum cushion, which is a reserve kept in the account rather than an extra monthly charge.
Frequently asked questions
How is the monthly escrow amount estimated?
The calculator divides your annual property tax and annual insurance by twelve and adds them together. Your servicer’s escrow analysis also looks at the timing of each bill and your current account balance, so your actual amount can differ.
What is an escrow cushion?
A cushion is extra money held in the escrow account to cover unexpected increases. Federal rules generally limit it to one-sixth of the estimated annual escrow payments, which is about two months. The cushion is a reserve balance, not an added monthly fee.
Why did my escrow payment go up?
Escrow payments usually change after the servicer’s annual escrow analysis, most often because property taxes or insurance premiums rose. If the account came up short, the servicer may also spread a shortage over future payments.
What is the difference between an escrow shortage and a deficiency?
A shortage means the account balance is below the target balance when the servicer runs its escrow analysis. A deficiency means the account actually has a negative balance. Your annual escrow statement explains which applies and how it will be repaid.
Lighthouse provides educational information, not a personal loan quote, lending decision, or legal or financial advice. Results are estimates based only on the numbers you enter. Verify the figures against your documents and ask your lender, servicer, or a qualified professional about your circumstances.