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Why is it necessary to maintain escrow accounts?

April 26, 2017accounts escrow maintain necessary

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Why is it necessary to maintain escrow accounts?

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When you signed your mortgage contract you agreed that a certain amount of your monthly payment would be held in escrow by WHEDA® for payment of insurance and taxes. An escrow account works like a savings account, but the money in the account can only be used for one purpose, the payment of your annual real estate tax bill and insurance premiums. WHEDA pays you interest on your escrow account. This interest is credited to your escrow account at the end of the year.