Word of the day
Hi,
Today we bring you another word of the day. There are so many aspects to purchasing a home, from the search, the home itself, financing and more. We hope that whenever and wherever you purchase a home in the Phoenix and Scottsdale metro area that these little tidbits help. And of course call us for personal attenttion as well.
Impound Account - Account held by the lender for payment of taxes, insurance, or other periodic debts against real property.
Your impound account is started with part of your closing costs. At closing you are typically paying for your first year of homeowner's insurance, as well as part of the estimated taxes (and other things). Most people elect to have the insurance and taxes paid monthly with their mortgage payment versus direct billing from the insurance company and county. When this is done the homeowner is paying PITI or Principal, interest, taxes and insurance. Since you pay for your insurance at the begining of the insurance year, each month you pay 1/12th of the annual premium into the impound account which is held by the lender to paid at the billing time. Property taxes are billed and due semi-annually. The same function occurs with the escrow account.
If you have any further questions please don't hesitate to contact us.
Adam Tarr, ePro
Sharon Kotula, ABR
RE/MAX Excalibur
Scottsdale, AZ
480-483-3333
info@WeAreAZRealEstate.com
Your Phoenix Area Real Estate Source