Stateside Lending · NMLS #2567704 · Equal Housing Opportunity

Escrow accounts, explained

Why your payment includes taxes and insurance.

Owning

Most mortgage payments bundle more than principal and interest. An escrow (or impound) account is how your servicer collects and pays your property taxes and homeowners insurance for you.

How it works

Each month a portion of your payment goes into escrow. When taxes and insurance come due, the servicer pays them from that account — so you're not hit with large, irregular bills.

The annual escrow analysis

Once a year your servicer reviews the account. If taxes or insurance rose, your monthly escrow (and total payment) can go up; if you overpaid, you may get a refund. This is the most common reason a "fixed-rate" payment changes.

Your principal and interest stay fixed on a fixed-rate loan — it's the taxes and insurance portion that can move your total payment over time.
Educational content only — not financial advice or a commitment to lend. Programs, rates, and guidelines vary and change; talk to a Stateside expert about your specific situation. NMLS #2567704.

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