I don’t often comment here

but having worked in loan servicing where my job was basically handling the escrow on mortgages, I just wanted to throw in my two cents. I would very carefully read over that escrow statement. If anything doesn’t make sense call the mortgage company and ask them to explain it. That is a really large overage (anything over $500 was questioned in my job) and has to have a pretty significant change in something. If you have any feeling that something isn’t right question it now. I have seen too many mortgage payments become almost unaffordable due to escrow issues.

It’s probably not a screw up

They have possibly just completed an audit at the mortgage company or something like that. Personally, I would hold it in case homeowners ins. goes up in the next year. I almost never goes down or remains the same for us. Or …. you could throw it at the current debt you’re paying on. Or, thirdly, use it to boost your baby emergency fund.