Final answer:
An escrow closing statement that refers to recurring costs could be describing the expenses related to property taxes and home insurance that are included in your monthly mortgage payment.
Step-by-step explanation:
An escrow closing statement that refers to recurring costs could be describing the expenses related to property taxes and home insurance.
When you purchase a home, you may have to pay property taxes and home insurance regularly. With escrow, instead of paying separate bills for these expenses, you can include them in your monthly mortgage payment. This ensures that the money is set aside and paid on your behalf to the appropriate parties when the bills are due.
For example, let's say your monthly mortgage payment is $1000. Of this amount, $700 goes towards your actual mortgage, while $200 goes into an escrow account to cover property taxes and home insurance. When the property tax bill of $1200 is due, the escrow account will pay it on your behalf.