Finance
What is the purpose of an escrow impound account associated with a mortgage?
ATo hold the buyer's earnest money deposit
BTo hold funds for the payment of property taxes and insurance on behalf of the borrower✓ Correct
CTo fund repairs required by the appraisal
DTo reserve funds for future refinancing
Explanation
An escrow impound account (also called an impound or reserve account) is set up by the lender to collect monthly amounts from the borrower for property taxes and homeowners insurance. The lender then pays these bills on the borrower's behalf when they come due.
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