Escrow Account:
A financial instrument held by a third party on behalf o the other two parties in a transactions. The funds are held by the escrow service until it receives the appropriate written or oral instructions or until obligations have been fulfilled. Securities, funds and other assets can be held in escrow.
If there are conditions to the sale, such as the passing of an inspection , the buyer and seller may agree to use escrow. In this case, the buyer of the property will deposit the payment amount for the house in an escrow account held by a third party. Once all the condition of the sales are satisfied, the escrow transfer the payment amount to the sellers, and title is transferred to the buyer.
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