RESPA does not authorize you take money from the escrow and apply it for other purposes. The customer’s money in the escrow account is placed there for a very specific purpose, such as paying taxes or insurance. If there is an overage, a short cycle statement can be run to determine the exact amount of the escrow, then the surplus must be sent to the customer (check or credit to a deposit account). Then, if the customer chooses, they could apply the surplus to resolve the past due status.
