Check Your Understanding Answers
- What is escrow?
Escrow is the process in which a disinterested third party holds all money and documents relating to a transaction until all of the terms and conditions of the escrow instructions have been satisfied.
- Describe an escrow agent.
An escrow agent is a neutral third party who performs the duties necessary to transfer ownership between the parties in a fair, impartial manner.
- When can a broker act as an escrow agent?
A broker can act as an escrow agent only if he or she is acting as the broker in that particular real estate transaction. When acting as an escrow agent, the broker cannot delegate any of the escrow duties to another person.
- List the five basic steps of the escrow process.
- Select the escrow company
- Send the purchase contract to the escrow holder
- Open the escrow
- Complete all items outlined in the escrow instructions
- Close the escrow
