What is a Golden 1 First Mortgage escrow account shortage?

A shortage occurs if your projected balance is less than the amount necessary to make any anticipated tax and/or insurance payments over the projected period. Typically, if you are paying the monthly escrow payment as scheduled and if there are no unanticipated increases to taxes or insurance premiums, then you should not have a shortage. However, a shortage can still occur if a tax or insurance payment due date changes. The most common reason for a shortage is if the amount for taxes or insurance premiums increases and/or an escrow payment is not made.

Take the earlier example under the question “How is my escrow payment calculated?” If the insurance payment increased from $800 to $925, the actual balance in the escrow account would be less than the projected balance. In this example, the shortage in October would be $125 (projected balance of $1,145 minus the actual balance of $1,020).
 

Month	Escrow Payment	Tax/Insurance Payment	Projected Balance	Actual Balance
January	$194.50		$194.50	$194.50
February	$194.50		$389.00	$389.00
March	$194.50		$583.50	$583.50
April	$194.50		$778.00	$778.00
May	$194.50	$925.00 Insurance	$172.50	$47.50
June	$194.50		$367.00	$252.00
July	$194.50		$561.50	$436.50
August	$194.50		$756.00	$631.00
September	$194.50		$950.50	$825.50
October	$194.50		$1,145.00	$1,020.00
November	$194.50	$1,200.00 Tax	$139.50	$14.50
December	$194.50		$334.00	$209.00