Paying your property taxes can feel like a chore, especially when you already have an escrow account diligently handling it! So, what happens if you decide to bypass the escrow and pay those taxes directly? Well, here's the lowdown.
Technically, you CAN pay your property taxes directly even if you have an escrow account. However, *should* you? Probably not. Your lender set up the escrow precisely to ensure property taxes (and often homeowners insurance) are paid on time. Paying directly, without informing them, can create confusion and potentially trigger penalties.
Here's why it's generally a bad idea:
* **Escrow Shortfall:** Your lender expects funds to come from the escrow account. Paying directly can create a 'shortfall', leading to increased monthly payments to replenish the escrow.
* **Potential Penalties:** If the lender *also* pays the taxes (unaware of your payment), you could face double payments and potential penalties from the taxing authority.
* **Communication Breakdown:** It disrupts the established communication flow between you, the lender, and the taxing authority.
Instead, if you *really* want to handle taxes yourself, contact your lender *first*. They might allow you to remove the escrow account entirely, but this usually requires meeting specific criteria, like a certain loan-to-value ratio. Otherwise, stick with the escrow – it's there for your convenience and financial safety!
