Escrow or No Escrow? How Florida Keys Homeowners Handle Taxes & Insurance

Living in the Florida Keys comes with sunshine, salt air… and a few grown-up decisions.
One of the biggest is how to pay your property taxes and insurance.

When buying a home, most buyers face a choice:
Do you roll taxes and insurance into your mortgage, or handle them separately?

There’s no right or wrong answer. There’s just the option that fits you best.

What Is an Escrow Account?

An escrow account means your taxes and insurance are bundled into your monthly mortgage payment. Your lender collects the money and pays the bills when they’re due.

• One predictable monthly payment

• No large, surprise bills

• Less to manage

• Often required for FHA, VA, or low-down-payment loans

For many buyers—especially early on—escrow keeps things simple.

The Drawbacks of Escrow in the Keys

Escrow isn’t perfect, especially here.

• Monthly payments can increase when insurance goes up

• You have less control over how your money is handled

• Your payment may change even if your loan didn’t

That surprises a lot of homeowners.

Paying Taxes & Insurance Separately

Without escrow, your mortgage payment includes principal and interest only. You pay taxes and insurance directly, usually once or twice a year.

• Lower monthly mortgage payment

• More control over insurance choices

• You keep your money longer

The Trade-Off

• Annual bills can feel large

• You must stay organized

• Missed payments fall on you

My Personal Experience

Years ago, I chose to separate my taxes and insurance from my mortgage.

And yes—
those annual bills can still surprise me sometimes, even when I know they’re coming.

That said, we plan for it.
We set funds aside and stay ahead of the deadlines.

For me, the flexibility and control are worth it. But it’s not the best fit for everyone.

Can You Choose This at Purchase?

Sometimes.

You’re more likely to have the option if:

• You put 20% or more down

• You’re using a conventional loan

• You have strong credit

Escrow is usually required with FHA and VA loans.

💡 Even if escrow is required at closing, many lenders allow you to remove it later.

A Florida Keys Reality 🌴

Insurance costs here change often.
When they do, escrow payments adjust—and that can catch homeowners off guard.

Understanding why payments change makes a big difference.

Which Option Is Best?

• Escrow works well for simplicity and peace of mind

• No escrow works well for organized homeowners who want control

Neither choice is wrong.
It’s about what fits your lifestyle.

A little planning goes a long way—especially in paradise.