What is an Escrow account and PITI?
A mortgage payment consists of Principle and Interest (P & I) payments made each month. All lenders require you to pay the appropriate Property Taxes associated with the property and the Homeowners Insurance premium (hence, PITI). Depending on the type of loan you have and the amount of equity in your property you may be able to pay the taxes and insurance yourself.
If not your lender will set up and maintain an Escrow Account for you ensuring the property taxes and homeownersu2019 insurance obligations are paid to on time.u00a0 The escrow account is simply a method for collecting the payments on a monthly basis and then distributing the funds when they are due.
For more information on this please contact your Great Western Loan Officer.
Great Western Home Loans