An escrow balance is the amount of money held in an escrow account for payments that your lender will make on your behalf, such as property taxes and insurance premiums. Mortgage payments usually include some portion held in escrow for these purposes, and many lenders require escrow accounts to protect their investment and ensure that taxes and insurance are paid. The escrow balance is separate from the principal balance, which refers to the amount of the home loan that is still outstanding. You cannot access the money in your escrow account, and banks generally do not pay interest on your escrow balance. The escrow company will periodically do an escrow analysis, which may cause your monthly payment to change.