Escrow: What you need to know

An escrow account allows us (SPC) to pay the required insurance and/or taxes on your property for you. You pay a portion of your taxes and/or insurance premiums as part of your monthly mortgage payment. Then, when taxes and/or premiums are due, we’ll pay them on your behalf with the money in your escrow account.

An escrow account helps you budget for large expenses, like property taxes and insurance. Plus, we pay them on your behalf when they're due, which saves you time and gives you peace of mind that your payments will be made on time.

Each year, we project how much you’ll need in your escrow account for the upcoming year. We base it on the amount of taxes and/or insurance you paid during the past 12 months. The total paid is divided by 12 to get your projected monthly escrow payment.

Sometimes, your payment must be adjusted to ensure your monthly balance remains above a required minimum balance during the next 12 months. This minimum balance is typically equal to two months of escrow payments.

If your taxes and/or insurance change during the next year, or your monthly escrow balance falls below the required minimum amount, you could have a shortage or surplus in your account when we do an Annual Escrow Analysis next year.

We estimated your tax payments and/or insurance premiums before your loan closed using the most recent tax and/or insurance amounts paid on the property. If your home is newly constructed, we may base our estimate on the taxes you paid for the property before you made any improvements.

We have to project your tax and/or insurance premiums based on the amounts you paid in the previous year, unless we receive official notice of an amount change for the upcoming year from a taxing authority or insurance provider.

A shortage occurs when the escrow account balance at its projected lowest point for the next 12 months is below the required minimum balance. This required balance is typically equal to two months of escrow payments. It helps to protect you, so you have enough funds in the account to cover an unexpected tax and/or insurance increase.

If your taxes and/or insurance costs were lower than expected, your account may have a surplus. If the surplus is $50 or more, a surplus check will be attached to your Annual Escrow Analysis. Please detach the check and cash it. For surpluses less than $50, your money will be left in your escrow account.

There are a few reasons why you might not have enough money in your escrow account to meet the minimum balance:

• Your property taxes and/or insurance premiums increased.

• Your taxes were reassessed.

• Your insurance provider(s) changed.

• The due date of your property taxes and/or insurance premiums changed.

• You made fewer escrow payments into your account than expected.

• Your starting escrow balance for the 12-month period was lower than expected due to higher payouts the prior year.

If you have questions about an increase in your property taxes or insurance premiums, please contact your local taxing authority or insurance agent.

You have three options for paying a shortage:

Option 1: Pay nothing and spread the shortage amount evenly across next year’s payments.

Option 2: Pay the full shortage now. Please note, if your tax and/or insurance expenses have increased, your monthly mortgage payment may still go up, even if you pay all of the shortage. Your monthly payment should update within five days of paying the shortage.

Option 3: Pay part of the shortage. The remaining shortage balance will be spread out over 12 months and added to your monthly mortgage payment.

To make a shortage payment on your Escrow account go to any of the following branches:

• SPC Credit Union 204 N. Fifth St. Hartsville, S.C. 29550

• SPC Credit Union 109 E. McIver Rd., Darlington, S.C. 29532

• SPC Credit Union 1312 Celebration Blvd. Florence, S.C. 29501

• SPC Credit Union 204 US-15 Bennettsville, S.C. 29512

• SPC Credit Union 849 Chesterfield Hwy. Cheraw, S.C. 29520

If you mail your shortage payment to us, please send it to the following address with the coupon from your escrow statement:

SPC Credit Union

Attn: Mortgage

P.O. Box 1355

Hartsville, SC 29551

Your payment may still go up, even if you pay the entire shortage, if your taxes or insurance increase.

1. You can pay all or part of your shortage up until February 13, 2026.

2. After you make your shortage payment, you'll receive a statement 7-10 days later showing the shortage payment and your new monthly payment amount.

3. Any escrow-related changes to your mortgage payment will go into effect on your due date one month after your analysis is completed.

For example, if your analysis is completed in January, a payment change would take effect in March. Please note that even if you pay all of your shortage, your monthly payment may still change if your taxes and/or insurance increase.

You may not be able to prevent a shortage, but you can minimize the impact by staying informed about your escrow account.

If it’s higher than projected, you can make an additional escrow payment to help lower or prevent a shortage.

You'll need to continue making the higher payment until the effective date on your escrow analysis, which will begin on March 1, 2026.