Taxes and Insurance
Learn what’s included in the management of your escrow account.
What kind of taxes are included in my escrow account? Your escrow account holds money and pays the costs associated with real estate property taxes as determined by the property’s location.
What types of insurance are managed in my escrow account? Your escrow account holds money and pays the costs of these types of insurance:
- Flood (if required in your property’s area)
- Private Mortgage Insurance (PMI) (if required)
- Mortgage Insurance Premium (MIP) (if required)
What is Private Mortgage Insurance (PMI)? PMI is a type of insurance often required on conventional loans when the homeowner has less than a 20% down payment. It protects the mortgage lender if the account goes into default or foreclosure.
Can I remove PMI? Under federal law, you can request early PMI cancellation. PMI can be removed, but certain requirements apply depending on your loan type and state, federal and investor guidelines. Typically, the removal of PMI requires a minimum 80% home appraisal value compared to the loan amount. To discuss your options and/or start the removal process, email us at email@example.com or call our Customer Care Department at 1-800-449-8767.
What is Mortgage Insurance Premium (MIP)? MIP is a type of insurance required on all Federal Housing Administration (FHA) loans. It protects the mortgage lender if the account goes into default or foreclosure.
Can I remove MIP? MIP removals are determined by the amount of your down payment and when you first took out the loan. Usually, MIP lasts 11 years or for the life of the loan. To permanently remove MIP, you’ll have to refinance into conventional
Visit the Frequently Asked Questions section for more common questions and answers.