Why Did My Mortgage Payment Go Up?

Few things catch homeowners off guard like opening a mortgage statement and realizing the payment went up—especially when nothing about the loan itself seems to have changed.

No refinance.
No missed payments.
No new purchase.

So why did the payment increase?

In most cases, the answer has nothing to do with your interest rate and everything to do with escrow adjustments. And this happens to homeowners across Lubbock every year.

Let’s break down the most common reasons in a way that actually makes sense.

1. The Most Common Reason: Escrow Adjustments

For the majority of homeowners, a payment increase is caused by changes in escrow—not the loan.

Your escrow account covers:

• property taxes

• homeowner’s insurance

• sometimes flood insurance

These bills are paid by your lender, but the money comes from what you contribute monthly. When those costs change, your payment changes with them.

2. Property Taxes Increased (or Were Higher Than Estimated)

Property taxes in Lubbock County can change for several reasons:

• the home was recently purchased at a higher value

• exemptions were not yet applied

• tax rates changed

• new construction assessments kicked in

If the lender estimated taxes too low initially, they still paid the full tax bill when it came due. That creates an escrow shortage, which must be corrected.

When that happens, your payment increases in two ways:

1. to cover future taxes correctly

2. to repay the shortage from the previous year

This is why increases can feel sudden or significant.

3. Insurance Premiums Went Up

Insurance costs—especially in Texas—can increase due to:

• inflation

• claims in your area

• carrier changes

• policy renewals

When insurance increases, escrow must collect more each month to cover the new premium. Even a modest insurance increase can noticeably affect your monthly payment.

4. First-Year Adjustments Are the Most Common

Many homeowners experience payment increases in their first year after buying.

This happens because:

• escrow was based on estimates

• prepaids only partially funded the account

• seller tax credits didn’t become escrow cash

• exemptions weren’t applied yet

Once real numbers replace estimates, escrow recalculates—and that’s often when the payment adjusts.

This doesn’t mean something went wrong. It means the system is catching up.

5. Why It Feels Like It Came Out of Nowhere

Lenders perform an annual escrow analysis, typically once per year.

At that time, they compare:

• what escrow collected

• what escrow actually paid

If there’s a shortage, the lender notifies you and adjusts the payment going forward.

Because this happens only once a year, it can feel abrupt—even though the change reflects costs that built up over time.

6. What Homeowners Can (and Can’t) Control

You generally can’t control:

• tax rate changes

• insurance market conditions

But you can:

• file homestead exemptions when eligible

• review insurance policies annually

• understand your escrow statement

• plan for first-year adjustments

Clarity helps reduce stress—even when numbers change.

Bottom Line

When your mortgage payment goes up, it’s rarely because of your loan. Most increases are driven by escrow adjustments tied to taxes and insurance—especially in the first year of homeownership.

Understanding why the payment changed makes it far less alarming and helps you plan moving forward.

If your payment increased and you’re not sure what triggered it, I help homeowners in Lubbock walk through their escrow statements step by step so they understand exactly what changed—and why.