Real Estate Term
Escrow
A neutral third party that holds funds or documents until specific conditions are met.
What is Escrow?
Escrow is an arrangement where a neutral third party holds money or documents on behalf of a buyer and seller until the agreed conditions of a transaction are met. It protects both sides by ensuring funds only change hands once obligations — like clearing title or meeting conditions — are satisfied. A purchase deposit is commonly held in escrow and then applied to the price at closing.
Frequently asked questions
Related terms
DepositA sum of money paid as part of an offer to purchase, held in trust until closing.ClosingThe final step in a real estate transaction where ownership transfers from seller to buyer.Title SearchAn examination of public records to confirm a property's legal ownership and identify any claims.TitleLegal ownership of a property.
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