Teresa Tims, TheSoCalLoanPro.com. What Are Impounds or escrow account?
Escrow account, taxes, insurance, when you hear the word “impounds” or hear the word “escrow”, just think of that as your tax and insurance account. A little Side account in your mortgage to pay your taxes and insurance as needed.
Sometimes it accrues extra money and you get a check of any overage and sometimes it can have a shortage and you might have to send in some money or your payment will be adjusted accordingly.
So impounds are when you have your principle, interest, taxes and insurance, IN your monthly payment. The taxes insurance portion are what’s called impounds and kept in an escrow account.
When you look at your mortgage statement. You look on the upper right side. It will usually say “escrow balance”. And that’s because in California, taxes are due twice a year, in November and March. Then your fire insurance, otherwise known as hazard insurance, is due one time a year. Also referred to as Impound.
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