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Aggregate Adjustment

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Aggregate adjustment is the calculation a mortgage lender uses to prevent collecting more money for a borrower's escrow account than is allowed under the Real Estate Settlement Procedures Act (RESPA).

Under RESPA, mortgage lenders can’t keep more than 1/6 of the annual property tax and insurance payment amount as a cushion in the borrower's escrow account at any one time.

Prior to closing, the lender will calculate the aggregate adjustment to determine whether they need to credit any money back to the borrower to prevent the escrow account from holding more funds than are allowed.

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