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What are impounds/escrow accounts?

April 26, 2017accounts escrow impounds

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What are impounds/escrow accounts?

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In addition to the principal and interest payment on your mortgage loan, you may elect to impound additional funds each month in an impound/escrow account to pay for property taxes and insurance. With some mortgage programs, impounding for taxes and insurance may be required. Having an impound/escrow account allows you to put aside a small portion each month toward the costs of insurance and property taxes. You send the additional funds each month when you make your mortgage payment. MortgageMint® holds the money in an impound/escrow account and makes the payments from the account when they are due.