41. A typical monthly home loan payment includes principal, interest, taxes, and insurance. Why do lenders require borrowers to contribute to their annual property taxes with each monthly loan payment? A borrower never pays a portion of their annual taxes as part of their monthly loan payment. Instead, they make a single lump- sum payment each year. It allows the borrower to pay less in property taxes each year. It serves as security for the lender. This way the lender ensures the borrower's taxes are paid each year and a tax lien will not be placed on the property. It allows the borrower to write-off their tax payments when filing their personal income tax

41. A typical monthly home loan payment includes principal, interest, taxes, and insurance. Why do lenders require borrowers to contribute to their annual property taxes with each monthly loan payment? A borrower never pays a portion of their annual taxes as part of their monthly loan payment. Instead, they make a single lump- sum payment each year. It allows the borrower to pay less in property taxes each year. It serves as security for the lender. This way the lender ensures the borrower's taxes are paid each year and a tax lien will not be placed on the property. It allows the borrower to write-off their tax payments when filing their personal income tax

Foundations of Business - Standalone book (MindTap Course List)

4th Edition

ISBN:9781285193946

Author:William M. Pride, Robert J. Hughes, Jack R. Kapoor

Publisher:William M. Pride, Robert J. Hughes, Jack R. Kapoor

Chapter15: Using Management And Accounting Information

Section: Chapter Questions

Problem 5DQ

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Similar questions

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