An escrow account is a short lived account held by a impartial third get together on behalf of two different events concerned in a transaction. The aim of an escrow account is to make sure that all situations of a gross sales contract are met earlier than the funds are launched to the vendor. An escrow agent, typically a title firm or a financial institution, acts because the custodian of the funds and ensures that each one events fulfill their obligations as agreed. Escrow companies are generally utilized in actual property transactions, however they can be utilized to different varieties of transactions like enterprise offers, authorized settlements, and extra.
Escrow accounts provide a number of advantages, together with:
