Escrow accounts

An escrow account is a temporary deposit held by a third party, usually called an escrow agent, on behalf of two other parties. The temporary account operates until the transaction is complete and all conditions between both parties are settled. The money or other assets are debited from the escrow account when certain predetermined legal obligations are fulfilled or the escrow agent receives an instruction to release the assets. Escrow accounts are designed differently to regular accounts. While they can be used to hold securities, funds, money and other assets, these temporary deposit arrangements are most often used in real estate transactions.

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