Which law requires an annual escrow analysis?

The law that requires an annual escrow analysis is the Real Estate Settlement Procedures Act (RESPA). Under RESPA, lenders are mandated to conduct an annual analysis of the escrow account to ensure that the account is adequately funded and that any excess amounts are returned to the borrower. This requirement is intended to provide transparency to borrowers regarding the management of their escrow accounts, which typically hold funds for property taxes and insurance premiums.

RESPA's provisions focus on protecting consumers during the real estate settlement process and ensuring they have the information necessary to understand their finances related to real estate transactions. This annual analysis helps borrowers to be aware of their financial obligations and manage their escrow payments efficiently.

The other laws mentioned serve different purposes: the Truth in Lending Act (TILA) pertains to the disclosure of credit terms to borrowers; the Dodd-Frank Act encompasses a broad range of regulations aimed at reforming financial institutions and improving consumer protection; and the Equal Credit Opportunity Act (ECOA) prohibits discrimination in lending based on certain protected characteristics. Each of these laws plays a critical role in the mortgage industry but does not specifically mandate an annual escrow analysis like RESPA does.