The servicer must perform an escrow analysis prior to offering a Trial Period Plan. See Administering an Escrow Account in Connection With a Mortgage Loan Modification in B-1-01, Administering an Escrow Account and Paying Expenses for additional information.
Any escrow account shortage that is identified at the time of the mortgage loan modification must not be capitalized and the servicer is not required to fund any existing escrow account shortage.
If applicable law prohibits the establishment of the escrow account, the servicer must ensure that the T&I premiums are paid to date.
For more information please see: D2-3.2-07: Fannie Mae Flex Modification.