Property TaxesHomebuying Glossary
Property Tax Escrow
Money your lender collects monthly and holds to pay your property tax bill on your behalf.
In plain English
Many lenders require you to pay 1/12th of your estimated annual property tax bill each month into an escrow account, which the lender then uses to pay the tax authority directly when the bill is due.
Why it matters
This is why your monthly mortgage payment includes more than just principal and interest — it's rolling your tax bill into predictable monthly installments.
Where you'll run into it
Guides and tools on TheBuyingPath that cover property tax escrow in context.
Related terms
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