Costs & PMI
What is an escrow account?
Answered by Onias Derilus, Mortgage Capital · NMLS# 1859012 · Florida licensed mortgage broker
An escrow account is held by your lender to collect and pay your property taxes and homeowners insurance. A portion of each monthly payment goes into it, and the lender pays the bills when they're due.
It spreads big annual bills into manageable monthly amounts and is required on most loans with less than 20% down. In Florida, where insurance can be large, escrow protects you from a surprise lump-sum bill. Your account is reviewed yearly and adjusted.
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