Section 1000 - Reserves Deposited with the Lender: Reserves are funds the lender requires to be paid at closing if you plan to escrow your taxes and insurance. You pay a determined number of month's taxes at closing depending on the county and state where the property is located, as well as when the taxes are collected. Tax payments must be current for the year. You also pay a determined number of month's insurance. These fees are paid regardless of what lender you choose. You do not pay any fees in this section if you choose to handle escrow on your own. There are certain loan-to-value requirements in order to waive escrow and, in certain circumstances, a one-time fee at closing to handle escrow on your own may be charged by some lenders.