Insurance Term of the Day: Escrow

Buying a home is a big deal. The value of a home is likely the most expensive thing you will buy–worth hundreds of thousands of dollars. It would be nice if we could pay the cost of the home outright, but since this is impossible for most of us, we must have a few different means of financial help.            You will need a mortgage lender, and you will also need what’s called an escrow agent to mediate the money involved in the purchase.

Escrow refers to a neutral third party which ensures a safer transaction by holding onto and managing the money. This guarantees the correct usage of the money by both the buyer and the seller. An escrow account is part of the buying process of a home to ensure the integrity of both parties of the transaction. The purpose of an escrow account holder can be compared to the job of a referee: making sure both parties meet the agreements they made.

The escrow account holder collects the deposit money. Typically, the deposit is a small percentage of the full value of the home. Once the deposit has been made, the seller takes the property off the market in exchange. Until the very last payment has been made, the deposit and the property are “in escrow”.

It is the responsibility of an escrow account holder to accurately process transactions by request the of both parties at the right time. They handle the funds, or pay the authorized bills, following the instructions of the buyer/seller. At the finalization of the last transaction, it will be the escrow agent’s job to close the account as well.

By: KayLynn P.


Do you have questions about your insurance? Find an insurance agent near you with our Agent Finder

Buzz Your
Insurance Agent

Search for a local agent with our agent finder map.

Agent Finder

Search All Blogs

Search
Generic filters
Exact matches only
Search in title
Search in content
Search in excerpt

Buzz Your
Insurance Agent

Search for a local agent with our agent finder map.

Agent Finder

Want to learn more about
our blog writer?

Read more about KayLynn's background.

Search All Blogs

Search
Generic filters
Exact matches only
Search in title
Search in content
Search in excerpt

Life insurance; One Step at a Time

You Don’t Need a Big Budget To Get Your Life Insurance Program Started

Small Choices That Can Make Big Differences in Your Health

Don’t Let a Big Decision Stop You. Make Some Small Ones Instead.

Creating a Family Timeline

Building a family timeline is fun and interesting. Start with birthdays, weddings, graduations etc. and build it out from there!

Activities for the Family to Keep Everyone Fit

Share the Motivation for a Healthier Life with Your Family

Pre-Planning Doesn’t Require Pre-Paying

You Don’t Have to Wait Until You Are Financially Ready to Pre-Plan Final Services

How to Encourage Kids to Have Healthier Eating Habits

They May Not Eat Perfectly But They Certainly Can Eat Better

The Rising Popularity of “Celebrations of Life”

Final Services Are Changing. The Need for Life Insurance Is Not.

Seven Good Reasons to Take Up Biking

There’s More to Biking Than Tight Pants and Stylish Helmets

The Most Compelling Reason to Get Life Insurance

Of the Dozens of Reasons to Acquire Life Insurance, This May Be the Most Important

Staying Healthier: A Home Gym in the Space of a Closet

Motivation May Be a Factor But Lack of Space Should Not

Leave a Comment