Lenders may require escrow accounts to ensure that property taxes and insurance premiums are paid.

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Lenders often require escrow accounts as a way to ensure that borrowers keep up with their property tax and insurance payments. The lender will collect additional funds with each mortgage payment and hold them in the escrow account, which they will then use to pay the necessary bills on behalf of the borrower. This helps to protect the lender's investment in the property and ensures that the borrower does not fall behind on important expenses that could put the property at risk.

Lenders May Require Escrow Accounts to Ensure That Property Taxes