Finance
A Washington borrower's lender requires that property taxes and homeowner's insurance be paid through an escrow impound account. The initial escrow deposit at closing typically covers:
AOne month's taxes and insurance only
BSeveral months of taxes and insurance to establish the required escrow cushion plus the next upcoming payment✓ Correct
COnly the current year's taxes already assessed
DNo upfront escrow — just monthly payments going forward
Explanation
At closing, lenders require an initial escrow deposit to fund the account to a level that ensures funds will be available when taxes and insurance are due. This typically includes 2–3 months' cushion plus the prorated months until the next payment is due.
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