Escrow In Real Estate Transactions

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What Is Escrow?

Escrow is a security device where a third party is brought into a real estate transaction to make sure that the two main parties involved in the transaction fulfill their individual promises to each other. One or both parties deposit property or legal documents with the third party for a given amount of time or until the occurrence of some condition, at which time the third party is to hand the deposited items over to the appropriate party.

Who Is Involved In Escrow?

There are typically three parties involved in escrow. Their general classifications are as follows:

What Is An Example Of Escrow In A Real Estate Transaction?

The following is a typical example of how escrow is used in a real estate transaction:

Do I Need a Real Estate Lawyer to Help with Escrow?

A real estate attorney is generally not used as an escrow agent, but is often involved at other stages of a real estate transaction.  Real estate agents are typically familiar with the escrow process and generally have pre-designated escrow agents that they prefer to work with.  If your escrow agent fails to perform his duties during the escrow process, contact a real estate attorney immeditately.

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Last Modified: 03-31-2015 09:33 AM PDT

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