How Escrow Works in a Real Estate Deal
The neutral third party that holds the money and documents until closing conditions are met.
What is escrow in a real estate deal?
Escrow is an arrangement where a neutral third party holds money or documents on behalf of a buyer and seller until the conditions of the deal are met. It lets each side commit without having to trust the other with the funds directly — the escrow agent releases everything only when the agreed conditions occur.
What the escrow agent holds
Most commonly the escrow holder keeps the earnest money deposit between contract and closing, and at closing it holds and disburses the purchase funds, the deed, and payoffs according to the closing instructions. Brokers, title companies, and attorneys commonly serve as escrow agents.
Why escrow protects both sides
Because the escrow holder is neutral and follows written instructions, neither party can grab the money if a dispute arises — funds move only on agreement or a court order. That neutrality is what makes escrow the backbone of a safe closing.
How Nochumson P.C. helps
Nochumson P.C. handles the legal side of closings and escrow so the money and documents move exactly as they should. Contact us with a closing question.
Related articles:
- Earnest Money Deposits: Rules & Risks
- Closing Costs in Pennsylvania
- Agreement of Sale in PA Real Estate: Buyer's & Seller's Guide
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