Impound Account (Property Tax Reserves Explained)

 

What is an impound account? An impound account is a separate escrow account where reserves are set aside to cover your taxes and homeowners insurance fees when they are due. Before you close on the purchase of your home, your lender will go over your overall monthly payment, at which point, you'll need to opt in or out of having an impound account. Some of these monthly payments will include your mortgage, insurance and property taxes, and each of these typically have different due dates throughout the year. If you opt in for an impound account, this may give you peace of mind knowing that you won't miss one of the payment dates. If you are the type of person that likes to manage your own money and know when the payments are being made, you may choose to opt out of impound accounts. Opting out may also be for those that like to invest their money elsewhere.

If you would like to know more, please feel free to reach out to me and I would be happy to help set you up with a lender to discuss the many options that are out there!