Updated: Apr 13, 2020
Escrow is a financial service where a neutral third party or escrow agent holds the transaction fund on behalf of two parties involved in the transaction till the successful deal disclosure.
What is Escrow?
Escrow agent releases the fund only when the pre decided deal terms also known as escrow instructions are successfully satisfied. Escrow provides security to both buyers and sellers and ensures a smooth transaction.
Traditional escrow services provided by banks requires a lot of time and money to open the account but digital escrow accounts are faster to set up and requires less time. Digital account can be set up in minutes at very nominal costs. Escrow services are utilized in the software industry, car rentals, real estate and other heavy amount deals.
Why is Escrow needed?
The escrow services are well utilized in the US and other developed countries. Due to the increase in cases of cheats, frauds and trust deficit, the need of escrow is desired in each and every sector of the society.
Not only it saves your money but makes the transaction seamless and quicker in a timely manner. It gives assurance of money to the sellers for their efforts and also gives security to the buyers till they get the desired good or service.
With escrow services, buyers and sellers can easily make safe and secure transactions without fear of losing money. Not only it safeguards your money but also builds trust and confidence in the dealing parties for pleasant transaction experience.
What is an Escrow Account?
Escrow account is an account maintained in banks which is specifically opened to cater a transaction between two parties. Once the transaction is successfully closed, the escrow account is closed automatically. Escrow Account is created once the agreement is signed between the buyer and seller clearly stating the deal terms and escrow instructions. You can not withdraw money from an escrow account till the deal terms are successfully met. The amount deposited in escrow is restricted for a specific purpose.
Who pays the Escrow fees?
There are different models of paying escrow fees. It is completely decided by the buyer and seller who will pay the escrow fees.
Buyer pays the escrow fees
Seller pays the escrow fees
Buyer and seller pay the escrow fees proportionately
How does Escrow Work? What is the Process of Escrow?
Escrow services follow a custom procedure:
Buyer and seller agrees to the terms: Buyer and seller agree to purchase and sell goods or services.
Buyer Transfers the funds to the Escrow Account: After mutually agreeing on all deal terms, buyer transfers the deal amount or a portion of it to the escrow account. Escrow intimates the seller that the deal amount has been successfully deposited in the escrow account.
Seller transfers the goods or property rights to the buyer: Upon successful delivery of goods or services, Buyer and Seller notifies Escrow.
Escrow releases the funds to the seller: Escrow releases the funds to the seller or other vendors of the transaction.
How can we help you?
EscrowBharat is a digital escrow provider helping safe and secure real estate transactions. It lets you set up your digital escrow account online saving your time and efforts. It also provides standardized agreements which are easier to understand and reduces legal fees. If you have other deal terms, we will cover that in the agreement. To know more about escrow services, please contact our team at +91 8528524242. Also, email us at email@example.com
Ensure successful deal closure in a safe and hassle free way!