Escrow Quiz

1. What is an escrow account in real estate?

A savings account for the buyer A neutral third-party account that holds funds during a transaction The down payment to the seller The lender's account

2. What does an escrow account typically pay on behalf of the borrower?

Mortgage principal only Property taxes and homeowner's insurance Real estate agent commissions Home repairs

3. What is an escrow cushion or reserve?

Extra funds held in escrow for unexpected expenses The initial down payment A fee charged by the escrow company The loan processing fee

4. When is escrow closed in a real estate transaction?

When the buyer moves in When all conditions of the sale are met and documents are recorded When the loan is approved After the inspection

5. What is earnest money in escrow?

Money returned to the buyer if the deal falls through A deposit made by the buyer to show good faith The final payment at closing The agent's commission

6. Can escrow payments be waived?

Yes, always Sometimes, for borrowers with sufficient equity and good credit No, never Only for VA loans

7. What happens to escrow funds if the loan is paid off?

They are kept by the lender They are returned to the borrower They are transferred to the new loan They are donated to charity

8. Who manages the escrow account?

The buyer The seller The lender or mortgage servicer The real estate agent

9. What is a tax impound account?

An account for property tax payments An account for income tax payments An account for business taxes An account for sales tax

10. What is an escrow analysis?

A review of the buyer's credit An annual review of escrow account balances and payments A property inspection A title search

Quiz Results