Changes in Mortgage Account Setup
How Escrow Affects the Monthly Payment
I am working on changing the way mortgage debt accounts are handled on Undebt.it to make the calculations more accurate. The original way I had mortgage debts setup was the same as all of the other debt accounts – simple balance adjustments based off of payment amount and interest rate. However, most mortgage accounts have an escrow account associated with them for property taxes, homeowners insurance, PMI, etc. Undebt.it will now allow you to take the escrow account into consideration with an “escrow payment” field that’s only visible on mortgage accounts. The “monthly payment” field should be your actual mortgage amount (without any of the escrow fees). If you don’t use an escrow account or don’t want to separate them, just use the full amount in the monthly payment field and leave the escrow payment at zero.
In the example above, when you record your payment of $1,795, your payment history will show the $1,225 amount paid to the loan, of which approx. $516 of that will go to interest and the rest goes to the mortgage principal. Hope this helps clarify things a little….these changes will go into effect later tonight or tomorrow. Thanks for your feedback and support; keep it coming.