Finance
What is 'impound account' or 'escrow account' in the context of a Rhode Island mortgage?
AThe broker's escrow account for earnest money
BAn account held by the lender in which the borrower deposits monthly amounts for property taxes and insurance, which the lender pays on the borrower's behalf✓ Correct
CThe closing attorney's escrow account
DA DEM-required environmental escrow
Explanation
An impound (or escrow) account held by the lender collects monthly contributions from the borrower for property taxes, homeowner's insurance, and sometimes HOA fees. The lender disburses these payments when they become due.
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