Today we’re going to talk about escrow. It’s a big part of our lingo as real estate agents and escrow is an important part of any real estate transaction, but we rarely define it for our clients.
The best way to describe escrow is by using this example from the past. Back when eBay first came out around the turn of the century, I would bid on something and win, but the following back and forth with the seller was tough. I wanted to buy the item and the seller wanted to sell to me, but there needed to be some sort of trust involved. I didn’t want to send my money until I got the item, and the seller didn’t want to send the item until they got their money.
Finally, Elon Musk came up with Paypal to act as a middleman in these transactions. That’s pretty much the same function of escrow in real estate. It’s a neutral third party that holds the deed and the funds in an account until the appropriate time. Once escrow is completed, the seller signs over the deed, the buyer signs over the money, and the transaction is recorded by this third party.
Of course, there are plenty of other details about escrow to get into. If you have any questions or want to learn more, don’t hesitate to give me a call or send me an email. I look forward to hearing from you soon.