Escrow Definition and Legal Meaning
On this page, you'll find the legal definition and meaning of Escrow, written in plain English, along with examples of how it is used.
What is Escrow?
1\) n. a form of account held by an “escrow agent” (an individual, escrow company or title company) into which is deposited the documents and funds in a transfer of real property, including the money, a mortgage or deed of trust, an existing promissory note secured by the real property, escrow “instructions” from both parties, an accounting of the funds and other documents necessary to complete the transaction by a date (“closing”) agreed to by the buyer and seller. When the funding is complete and the deed is clear, the escrow agent will then record the deed to the buyer and deliver funds to the seller. The escrow agent or officer is an independent holder and agent for both parties who receives a fee for his/her/its services. 2) n. originally escrow meant the deed held by the escrow agent. 3) n. colloquially, the escrow agent is called an “escrow,” while actually the escrow is the account and not a person. 4) v. to place the documents and funds in an escrow account, as in: “we will escrow the deal.”