We believe that the single-item analysis calculation method has been phased out. In its place, the RESPA rules require you to use the aggregate accounting method when conducting any escrow account analysis, whether the initial analysis or an annual analysis. 12 CFR 1024.17(c)(4). Of course, you should separately itemize the taxes, insurance premiums and other escrow charges in the initial and annual escrow account statements. 12 CFR 1024.17(g)(1)(i)12 CFR 1024.17(i)(1).

To understand why the RESPA rules still include a definition and examples of single-item analysis, some background information is helpful. Before HUD adopted the aggregate accounting method for escrow accounts in 1994, HUD found that most institutions were using the single-item analysis method. HUD adopted its rule to establish a “nationwide accounting method known as aggregate accounting” for escrow accounts. Escrow Accounting Procedures, Final Rule, 59 Fed. Reg. 53890 (October 26, 1994). HUD phased out the single-item analysis method over three years so that financial institutions would have enough time to switch to the aggregate analysis method. Id.  We believe that the definition of “single-item analysis” is a vestige from that phase out period, left in for purposes of “pre-rule” accounts that existed before the effective date of HUD’s adoption of the aggregate accounting method. See 12 CFR 1024.17(j).

Several HUD public guidance documents also may contain vestiges for pre-rule accounts. In addition, rulemaking authority for RESPA has now switched to the CFPB, while HUD’s out-of-date guidance documents remain available online and elsewhere. We recommend relying on the CFPB for rules and guidance on RESPA going forward.