Question

If you obtain an FHA or VA loan you will make additional payments each month to cover your home insurance and property taxes that will be placed in an account called a(n)

A) insurance account.
B) appraisal account.
C) escrow account.
D) default prevention account.

Answer 1

If you obtain an FHA or VA loan, you will make additional payments each month to cover your home insurance and property taxes that will be placed in an escrow account.

Step-by-step explanation:

If you obtain an FHA or VA loan, you will make additional payments each month to cover your home insurance and property taxes that will be placed in an account called a(n) escrow account.

Escrow is a process where money is deposited by one person with a neutral third party, who will then pay both your home insurance and property taxes on your behalf. This helps you avoid having to pay separate bills for these expenses.