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My bank needs to send a short year escrow statement to a borrower because of a large increase in the property insurance premium. Is there a model form for a short year statement?

Yes, but it isn’t provided in an Appendix to Regulation X (Real Estate Settlement Procedures Act) as it is in most regulations, but in a Public Guidance Document entitled “Annual Escrow Account Disclosure Statement-Example,” 60 Fed. Reg. 24737 (May 9, 1995).

Section 1024.17(i)(4) of Regulation X refers to short year statements, providing: “A servicer may issue a short year annual escrow account statement (“short year statement”) to change one escrow account computation year to another. By using a short year statement a servicer may adjust its production schedule or alter the escrow account computation year for the escrow account.” However, as noted, the Appendix to Regulation X does not provide a model form.

The short year statement should contain the same content and be in the same format as the annual escrow account statement. (October 2020)

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