Most mortgage companies require what is known as an escrow impounds account, which basically holds money and pays your taxes and insurance for you. While some lenders allow you to "waive escrows", most will either charge you a higher interest rate, to offset their risk, or require that your LTV (loan to value) be below 80%. More often than not, you must have an LTV below 80 and you will be charged a penalty. 

The reason that lenders require an impounds account is in an effort to protect their collateral, your home. If you fail to pay property taxes, the county can put a lien on your property, which makes getting money out of foreclosure all the more difficult for the lender. Additionally, should your home burn down and you have a canceled home insurance policy, the lender's collateral has literally gone up in smoke.

"Waiving escrows" has little benefit, other than the fact that you will make a small bit of interest on the money. Otherwise, you are penalized for it and you'll just have an extra check or two to write.