Escrow Refund Explained: Timing & Amount (2026)
February 4, 2026
9 minutes
2025 Update: According to recent CFPB guidelines, most servicers must mail escrow refund checks within 20 calendar days after loan payoff.
Paying off your mortgage is a huge milestone - but one more payday often follows: the escrow refund. If you’ve recently closed your loan or sold your home, this guide shows exactly how long refunds take, why you get one, and how to make sure you receive it fast.
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How Long Does an Escrow Refund Take After Payoff?
| Step | Typical Timeline | Key Tip |
|---|---|---|
| Loan payoff processed | 0–5 days | Confirm payoff statement shows escrow balance |
| Servicer closes escrow | 5–15 days | Update mailing address/direct deposit info |
| Refund issued | 20–30 days | Follow up if not received |
What Is an Escrow Account?
When you first got your mortgage, your lender likely set up an escrow account, a separate fund used to pay your property taxes, homeowners' insurance, and possibly other fees. Each month, part of your mortgage payment went into this account.
When you pay off your loan, that escrow account is no longer needed. If there’s money left in it, that’s yours.
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Common Costs Paid Through Escrow:
- Property taxes
- Homeowners insurance
- Flood insurance (if applicable)
- Mortgage insurance (if escrowed)
What Is an Escrow Refund?
Bold Takeaway: An escrow refund is money returned from your mortgage escrow account after the loan is paid off.
This happens because servicers estimate property tax/insurance costs- if you paid in more than was used, the surplus is yours.
Why Do You Get an Escrow Refund?
Lenders are required under RESPA (Real Estate Settlement Procedures Act) to return any remaining balance in your escrow account after a loan is paid in full. This refund is separate from your home equity or closing credits.
The leftover amount is the taxes or insurance that were estimated higher than what was ultimately due, or because you prepaid monthly amounts that were not required.
Pro Tip: After your refund, explore what you can afford next using our Affordability Calculator or Mortgage Calculator.
Thinking of refinancing? Check potential savings with our Refinance Calculator.
How Long Does It Take to Get an Escrow Refund?
Most lenders issue escrow refunds within 20 to 30 business days after the mortgage is paid off.
Pro Tip:
If you’ve changed your mailing address, update it with your servicer before making your final payment. Many refunds are delayed or lost due to outdated contact information.
How Much Can You Expect to Get Back?
Refund amounts vary. It depends on:
- How much was in your escrow account
- What payments has the lender already made on your behalf
- The timing of your final mortgage payment
Example:
You paid off your mortgage in June, and your lender had just paid property taxes for the full year. You’ll get back the remaining balance minus what’s already been disbursed.
Do You Need to Request the Escrow Refund?
Usually, no. Mortgage servicers are legally required to close the escrow account and refund the balance within a reasonable time frame. However, if you haven’t received a refund after 30 business days, it’s a good idea to call your servicer.
Should You Refinance After an Escrow Shortage?
An escrow shortage happens when your lender didn’t collect enough in your escrow account to cover property taxes or homeowners insurance. When that happens, you’ll get a notice - and usually, your monthly mortgage payment increases to make up the difference.
But here’s the key question: should you refinance after an escrow shortage?
When Refinancing Makes Sense
Refinancing might be a smart move if:
- Your interest rate is above current market averages - lowering it could offset your new higher escrow payments.
- You’ve built home equity - you can use a cash-out refinance to pay the shortage in one go and reset your escrow account.
- You plan to stay in your home long-term - the upfront costs of refinancing can be recouped through lower monthly payments over time.
Pro Tip: Compare your new payment (including escrow) with your old payment to see if refinancing truly saves you money.
Use our Refinance Calculator to estimate potential savings in less than a minute.
When You Might Skip Refinancing
Refinancing may not be worth it if:
- Your current loan balance is low (less than 10 years remaining).
- You have recently locked in a competitive rate.
- The shortage was a one-time spike due to reassessed taxes or an insurance change.
In these cases, simply paying the shortage or increasing your monthly escrow contributions may be easier and cheaper than refinancing.
Quick Example:
Scenario | Current Mortgage | After Escrow Shortage | After Refinance |
|---|---|---|---|
Interest Rate | 6.75% | 6.75% | 5.99% |
Monthly Payment | $2,150 | $2,280 | $2,010 |
Annual Savings | — | — | $3,240 |
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How Escrow Refunds Work in Texas, Florida, and Georgia (State-Specific Rules)
Escrow refund timelines and requirements are guided by federal law under RESPA, but each state has its own nuances in how lenders process and release those funds. Here’s how it breaks down across three high-volume markets:
Texas Escrow Refund Rules
In Texas, servicers generally issue escrow refund checks within 20 calendar days after a mortgage is paid off or refinanced.
- Texas Administrative Code §155.4 requires lenders to maintain proper accounting of escrow balances.
- Homeowners should verify their county property taxes were fully paid before closing.
- If you’ve moved, submit a Change of Address Form (Texas Comptroller Form 50-114) to ensure your refund arrives on time.
Pro Tip: Many Texas servicers now offer direct deposit refunds, which can cut wait times from 20 days to as little as 5–7 business days.
Florida Escrow Refund Rules
Florida servicers typically refund escrow balances within 15 to 30 business days after loan payoff.
- Florida’s Consumer Collection Practices Act (Fla. Stat. §559.55) reinforces federal RESPA standards.
- Because Florida has annual property tax prepayments, refunds may be larger if you paid taxes in advance.
- Always confirm your title company and servicer coordinate final disbursements to avoid duplicate payments.
Tip for Florida Homeowners: Check your county tax portal (Miami-Dade, Broward, etc.) to see if property tax payments have already posted — this prevents confusion about refund amounts.
Georgia Escrow Refund Rules
Georgia follows RESPA’s 30-day maximum refund rule, but servicers often process sooner - around 10–20 business days.
- State code O.C.G.A. §44-14-3 governs escrow fund handling upon loan satisfaction.
- Georgia’s property taxes are usually billed in arrears, so your refund may be smaller than expected if taxes were due soon after payoff.
- Always keep your “Paid in Full” letter and escrow statement as proof in case of refund disputes.
Tip: If your servicer was acquired or merged (common in Georgia’s mortgage market), confirm which company holds your escrow balance before payoff.
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Bottom Line
While RESPA requires refunds within 30 days nationwide, local regulations and tax cycles can affect your exact timeline.
To avoid delays:
- Confirm your mailing address before final payment.
- Ask if your servicer supports electronic refunds.
- Keep a copy of your final escrow analysis for tax reporting.
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Final Checklist to Ensure You Get Your Escrow Refund
- Confirm your loan payoff statement includes the escrow balance
- Provide your updated mailing address or direct deposit info
- Keep copies of tax and insurance payments for verification
- Follow up after 30 days if no refund is received
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Related Guides on Homeownership & Mortgages
Want to go deeper? Explore these expert resources:
- Mortgage Payoff Statement: What to Know – Understand the document that finalizes your loan balance.
- Property Tax Basics in the U.S. – Learn how taxes impact escrow and refunds.
- Escrow Refund Explained – A full guide on why servicers send refunds after payoff.
- When Is the Best Time to Buy a House in Florida? – Timing tips for your next purchase.
- Conditional Approval: Here’s Everything You Need to Know – Step before final mortgage approval.
FAQs
1. How long does it take to get an escrow refund after paying off a mortgage?
Most servicers mail refund checks within 20 to 30 days after your loan is paid in full. If you don’t receive it after 30 days, contact your servicer with your payoff statement.
2. When do escrow refund checks get mailed?
Typically within two to three weeks after the escrow account is closed. Some lenders offer direct deposit - update your bank details early to avoid delays.
3. What happens to escrow when you sell your house?
Once your loan is paid off through the sale, the remaining escrow balance is refunded to you by check or deposit - usually separate from closing funds.
4. Do you get an escrow refund every year?
Only if your servicer’s annual analysis shows a surplus over $50. Otherwise, the balance rolls into next year’s payments.
5. Why did I get an escrow refund check?
Because your taxes or insurance were over-estimated. Once actual amounts are paid, any excess in your escrow account is returned to you.
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Article by
Rocky Billore is a mortgage industry leader and Chief Sales Officer with over two decades of experience across residential and commercial lending. Since entering the industry in 2004, he has been directly involved in funding more than $1.4 billion in loans. A recognized expert in VA and government lending, Rocky combines deep program knowledge with a data driven, relationship-first leadership style. His work focuses on building scalable sales organizations, developing high performing teams, and aligning technology with real world lending outcomes to improve the homeownership experience.