Should You Keep Escrowing Your Property Taxes and Homeowners Insurance?

When you have an escrow account, a portion of your monthly mortgage payment is set aside each month to pay your property taxes and homeowners insurance. Instead of paying these bills yourself, your loan servicer collects the funds and makes the payments when they’re due. This helps ensure these important expenses are paid on time.

One of the biggest advantages of an escrow account is convenience. Rather than coming up with a large lump sum once or twice a year, the cost is spread out over 12 monthly payments. This can make budgeting much easier for many homeowners.

Another benefit is peace of mind. Property taxes and homeowners insurance are essential to protecting your home, and missing a payment can lead to penalties, lapses in coverage, or other unnecessary complications. With an escrow account, your servicer handles these payments for you.

Some homeowners have the option to waive their escrow account and pay these expenses on their own. While this gives you more control over your money, it also means you’ll need to stay organized and save enough throughout the year to cover these bills when they come due.

Personally, I recommend keeping your escrow account whenever possible. It removes the stress of remembering multiple due dates and helps ensure your property taxes and homeowners insurance are always taken care of. For most homeowners, the convenience and peace of mind are well worth it.

If you’re considering removing your escrow account, talk with your loan servicer or mortgage professional first. They can explain whether you’re eligible and help you weigh the pros and cons based on your financial situation. Every homeowner’s needs are different, so it’s important to choose the option that works best for you.