What is escrow?
Escrow is a built-in account included in your regular monthly payment that sets aside money for specific home-related expenses. Instead of paying certain bills separately when they’re due, you contribute a little each month so the funds are available when payment time comes.
What expenses are paid through escrow?
Property taxes, homeowners' insurance, flood insurance and private mortgage insurance when required. Escrow may not include every home-related cost, so it’s a good idea to review your loan documents to see exactly what’s covered.
We have staff here at ASB dedicated to handling these payments for you, so you don’t need to! We track due dates and send payments on your behalf from the funds in your escrow account to help you stay on schedule and avoid missed payments.
Why your mortgage payment changes
Understanding why your mortgage payment changes—especially in your first year of homeownership—can feel confusing. Most homeowners expect their payment to stay the same, especially when they chose a fixed-rate loan. But while your principal and interest stay constant, the escrow portion of your payment can move up or down.
Escrow analysis
Once a year, we analyze your escrow account and determine whether you have a surplus or a shortage. At this point, your monthly payment may be adjusted to account for any escrow shortage or surplus identified.
Escrow documents at closing
Your lender will walk you through the escrow process at your loan closing and show you estimations of what your first year could look like.
Keeley Van Voorst
Assistant Vice President | NMLS#: 2095401