(703) 802-2850

The Kathy O'Neal Team

Real Estate in Chantilly Blog

Real Estate Terms to Know: Escrow Account

Escrow reserve accounts collect 1/12 of the annual bill each month

When I work with new Chantilly area first-time home buyers, one of the terms that they will see more than once is “escrow amount.”

The term refers to something like a savings account for funds that have a specific real estate purpose.  For example, it can be used for tax bills and homeowners insurance.

These accounts are normally held and managed by your mortgage company.

Typically, when you pay your monthly mortgage payment it will include 1/12 of the annual real estate tax bill, as well as 1/12 of the yearly homeowners insurance bill.  There are variations in how this can happen, but when those “escrowed” amounts need adjustment, you will get notice from the mortgage company.

Post