Escrow is a neutral arrangement in which a disinterested third party holds funds, documents, and instructions until the conditions of a real estate transaction are fulfilled.

• Involves three parties: buyer, seller, and escrow holder
• Escrow holder is a neutral agent
• Acts only on written escrow instructions
• Ensures proper transfer of funds and documents

• Protects all parties to the transaction
• Ensures conditions are met before closing
• Facilitates orderly transfer of title

• Follow escrow instructions exactly
• Safeguard funds and documents
• Prorate taxes, rents, and insurance
• Record necessary documents at closing
• Disburse funds when conditions are met

• Escrow may be handled by a title company, escrow company, or licensed attorney
• Escrow is not a fiduciary, but owes a duty of care and neutrality

• Open escrow: parties deposit documents and funds
• Close escrow: all conditions satisfied and documents recorded

• Escrow follows instructions, not discretion
• Escrow protects the transaction, not one party