Annual Mortgagor Statement
Definition and meaning of Annual Mortgagor Statement in real estate.
An annual mortgagor statement is a yearly summary provided by a mortgage servicer to the borrower detailing the total principal paid, interest charged, and escrow account transactions over the past year.
In more detail
Also referred to as an annual statement or Form 1098, this document is crucial for tax purposes because it lists the exact amount of mortgage interest and property taxes paid, which may be tax-deductible. The statement also shows the remaining principal balance at the end of the year and provides a detailed breakdown of escrow payments made for homeowners insurance and property taxes.
Borrowers should review this document carefully to ensure their payments were credited correctly and to check for any changes in their escrow account balance. If the escrow account has a shortage or surplus, the lender will adjust the borrower's monthly payment for the upcoming year accordingly.
Key facts
| Category | Mortgages & Financing |
|---|---|
| Also known as | Form 1098 or year-end mortgage statement |
| Required by | Internal Revenue Service (IRS) regulations |
| Typical timing | Sent to borrowers by January 31 of each year |
A homeowner uses the mortgage interest figure from their annual mortgagor statement to claim an itemized deduction on their federal income tax return.
Frequently asked questions
Why is the annual mortgagor statement important for taxes?
It shows the total mortgage interest and property taxes paid during the year, which are often eligible for itemized tax deductions.
What should I do if I see an escrow shortage on my statement?
You can typically choose to pay the shortage in a lump sum or allow the lender to spread the shortage across your monthly payments for the next year.