When a home owner makes his$/$her$/$their mortgage payment to the servicing financial institution two events generally occur, $1)$ a portion of the money goes directly to the financial institution to be put toward the balance of the loan, and $2)$ a portion of the money is held in a separate ESCROW account to be paid on behalf of the home owner to the government at a later point.

Typically the funds in the Escrow account are paid quarterly or semi$-$annually.

Which two of the components of the mortgage holder's PITI are held in escrow.

Principle and Taxes

Principle and Insurance

This is an example of a Moorman trick question. $q,$ there is no such thing as an Escrow account.

Insurance and Interest

Taxes and Insurance