Escrow accounts are used in conjunction with your mortgage loan. They act as a savings account to hold money to pay for property taxes and homeowner's insurance. Each month, the payment you make to the mortgage company includes a portion that goes towards paying off the loan and a portion that goes into the escrow account. Because failure to pay property taxes can result in a tax lien or foreclosure, some lenders require borrowers to maintain an escrow account to ensure that the payments are being made on time.
Property Tax Payments
Your lender must work directly with the county tax collector to obtain the information on your property taxes. The county sends the tax bill to the lender for review. The lender then makes a payment to the county using the
money from your escrow account. You should also receive a copy of your tax bill for your records; however, you don't need to pay your tax collector directly.
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