What Is an Escrow Account in New Hampshire Real Estate?
- Jim Johnson
- Nov 20
- 2 min read
🏡 What Is an Escrow Account in New Hampshire Real Estate?
When buying a home in Plymouth, Campton, Rumney, Thornton, Ashland, or anywhere across Central NH, lenders may require you to set up an escrow account.
An escrow account helps manage and streamline your property tax and insurance payments — ensuring they’re always paid on time and preventing financial surprises for homeowners.
Here’s exactly how escrow works in New Hampshire.
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What Is an Escrow Account?
An escrow account is a separate account managed by your lender.
Every month, part of your mortgage payment goes into this account to cover:
Property taxes
Homeowners insurance
Mortgage insurance (if required)
Flood insurance (if required)
Your lender uses this account to pay these bills on your behalf when they are due.
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Why Do Lenders Require Escrow in NH?
Many New Hampshire lenders require escrow accounts to guarantee:
✔ Property taxes are paid on time
✔ Insurance remains active
✔ The home remains protected (their collateral)
✔ Borrowers don’t fall behind on important payments
Escrow provides stability for both the lender and the homeowner.
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How Much Goes Into Escrow Each Month?
Your monthly escrow payment is based on:
Annual property tax amount
Annual homeowners insurance premium
Any other required insurance (flood, mortgage insurance)
These amounts are divided into 12 payments and added to your mortgage.
A cushion may also be included to prevent shortages.
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What Is an Escrow Shortage?
An escrow shortage happens when:
Taxes increase
Insurance premiums rise
Unexpected costs occur
Your lender will notify you and allow you to:
✔ Pay the shortage in a lump sum
or
✔ Spread it over 12 months in your mortgage payment
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Can NH Buyers Waive Escrow?
Some lenders allow escrow waivers only if:
You have excellent credit
You put down at least 20%
Your loan program permits it
Without escrow, you must handle taxes and insurance manually — which many buyers prefer to avoid.
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Q&A
Q: Does escrow change my mortgage payment over time?
A: Yes — if taxes or insurance change, your monthly payment may adjust annually.
Q: Are escrow accounts mandatory for FHA or USDA loans?
A: Yes — these loan programs require escrow.
Keywords
nh escrow account, new hampshire mortgage escrow, plymouth nh home buying, campton nh real estate, rumney nh taxes, thornton nh mortgage tips, central nh escrow rules
Jim Johnson — Real Estate Agent
58 NH Route 25A
Wentworth, NH 03282
P: (857) 249-7392
Licensed New Hampshire REALTOR® with Three Hills Real Estate Services
Broker Email: info@ThreeHillsRES.com
Broker Website: www.ThreeHillsRES.com
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