Helping Members Understand Escrow
Helping Members Understand Escrow
Nearly every person with a mortgage will come across escrow and the escrow analysis process during the life of their loan, but many Members — both new and experienced — still find them to be confusing, complicated and frustrating.
At Cenlar, escrow is consistently one of our top three call drivers, with an average of 60,000 calls per month. Most calls are for basic questions about escrow, such as, “Why do I have a shortage?”, “Why has my payment increased?” or “Have my taxes and insurance been paid?”
“Most people don’t have experience with escrow,” says Vice President of Special Products & Escrow Mark Kelbaugh. “When it comes to their mortgage, most members only think about their loan amount, interest rate and monthly payment. What they may not understand is that members’ insurance and taxes are part of their payment."
“It gets confusing for a member who has a fixed interest rate, yet their payment goes up. They’re not taking into account that perhaps their taxes have risen or their insurance may have changed. So when a member learns that they have an escrow shortage, it can be alarming."
“The thing about escrow is that it’s dynamic — there are things that are changing all the time. Every year, we review our members’ insurance coverage to make sure it’s been renewed. But if the member changes their carrier or type of coverage, it will impact their escrow account. Or if a property is suddenly classified as being in a hazard area or flood zone, their premiums will increase. And of course, tax amounts change almost every year.”
As a leader in the mortgage servicing industry, Cenlar is committed to enriching the escrow experience by enhancing our communications across all touchpoints to inform and educate our members on escrow. We’re working to ensure that our content is fresh, our messaging is consistent and that we take advantage of every vehicle available, including websites, emails and social media.
For onboarding members, Cenlar recently launched our Welcome Program, a series of communications that anticipate and proactively address members’ needs during the first three months of their journey. Among these touchpoints is an escrow email that links to a video that explains escrow. Right from the start, we’re providing this information because “we want our members to be educated, which deepens their experience and helps ensure a longer, more satisfying relationship with us,” says Kelbaugh.
In addition, Cenlar is testing the impact of including a video in our escrow shortage emails. The video explains in simple terms why an escrow shortage occurs and the payment options available. It’s informative and straightforward.
“We’re also in the process of redesigning our Escrow Account Analysis Statement. The new statement will have a clean design, using color and simpler language for improved readability,” says Kelbaugh. “And unlike our original statement, it will include messaging to explain the member’s shortage or surplus."
“All of Cenlar’s efforts to educate our members about escrow have been forward thinking and proactive. We’re doing something more for our members and I think that’s going to have a real positive impact on the member experience.”
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