Escrow account errors are the single most common complaint about BSI Financial — and about mortgage servicers in general. If your monthly payment suddenly went up, if your property taxes weren't paid on time, or if you got a shortage notice for thousands of dollars, an escrow error may be the cause. Here's how to identify and fix them.
How Escrow Accounts Actually Work
An escrow account is a holding account managed by your mortgage servicer to pay your property taxes and homeowners insurance on your behalf. Each month, a portion of your mortgage payment goes into this account.
Common Escrow Errors
1. Wrong Property Tax Assessment
The servicer estimates future property taxes based on prior years plus expected changes. If they use an outdated or wrong assessment, your escrow will be short (or excessively padded).
2. Insurance Paid to Wrong Company
If you change homeowners insurance carriers and don't properly notify BSI, they may continue paying premiums to your old carrier — while your new carrier goes unpaid.
3. Force-Placed Insurance
If BSI believes your homeowners insurance has lapsed, they can purchase "force-placed" insurance and bill you for it. Force-placed insurance is significantly more expensive than standard insurance and often provides much less coverage.
4. Escrow Shortage/Deficiency
If actual bills exceed estimates, you get a "shortage" (funds are below required cushion). BSI will typically raise your monthly payment to cover the difference.
Step-by-Step: How to Fix an Escrow Error
Step 1: Request Your Escrow Analysis
BSI is required to send you an annual escrow analysis showing all deposits, payments, and current balance.
Step 2: Verify Every Transaction
Cross-reference each escrow transaction against actual bills from your county tax office and insurance carrier.
Step 3: Send a Qualified Written Request
If you find errors, send a QWR to BSI Financial detailing the specific transaction(s) in dispute, documentation showing correct amounts, and the correction you're requesting.
See our complete QWR guide for the template.
Step 4: Follow Up in 30 Days
BSI must respond within 30 business days. If they don't, or if the response is inadequate, file a CFPB complaint at consumerfinance.gov/complaint.
Prevention Tips
- Updating BSI whenever you change insurance carriers — In writing, with confirmation
- Reviewing your annual escrow analysis carefully — Don't just file it
- Requesting escrow waivers if eligible — Some borrowers with 20%+ equity can manage taxes and insurance themselves
Considering a Refinance?
If you're unhappy with BSI Financial's service, refinancing to a different servicer may be an option. Check current refinance rates from top-rated lenders — free, no obligation, soft credit check only.