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

Understanding Business

12th Edition

ISBN:9781259929434

Author:William Nickels

Publisher:William Nickels

Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment

Section: Chapter Questions

Problem 1CE

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