WASHINGTON — The Clinton Administration has jumped into one of the hottest fights under way on Capitol Hill over consumer protections for homeowners:

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The Administration came out in favor of mandatory, nationwide interest payments on mortgage borrowers' escrow accounts, and a federally guaranteed right for consumers to terminate escrow accounts if they choose.

The Administration's position--strongly opposed by the mortgage lending industry--came in a late November endorsement of pending legislation sponsored by House banking committee chairman Rep. Henry B. Gonzalez (D-Tex.). In a letter to Gonzalez, Housing and Urban Development (HUD) secretary Henry G. Cisneros applauded the Escrow Account Reform Act and promised the Administration's help in pushing it through Congress.

Escrow accounts frequently add hundreds of dollars a month to a homeowner's mortgage payment, and are found in over three-quarters of all outstanding home loans, according to federal estimates. They are used by lenders to accumulate funds to pay borrowers' property taxes, insurance premiums, special local levies and other periodic expenses on a timely basis. They have become controversial in recent years because state attorneys general in more than a dozen states have charged that lenders routinely pad borrowers' escrow accounts--loading them up with far higher fund balances than necessary. In most states the funds sit in the accounts interest-free. Industry and government defenders of escrow practices have denied that accounts are padded, and have argued that lenders often undercharge consumers on escrows.

Among the key changes to existing law, the Gonzalez bill would:

--Force all lenders and mortgage servicers to pay interest annually, at a "passbook savings rate" determined by HUD, on all balances in mortgage borrowers' escrow accounts. Homeowners who refinanced or otherwise paid off their loans during the course of a year would be owed any accrued interest attributable to their escrow balances. The mandatory interest provision would take effect for all mortgages originated one year or more after the enactment date of the bill.