Escrow is a financial instrument held by a trusted third party on behalf of a buyer and seller. An escrow service can be used for the sale of a family home, right through to a wedding ring or even a treasured stamp collection.

The service protects the buyer and seller by managing all of the conditions of the sale and ensuring all elements are satisfied before the money is transferred to the seller.

Escrow plays a pivotal role in a financial transaction that is made online and adds an extra layer of protection for all parties involved.

Money escrow can be used for a wide range of reasons, during home renovations, selling high ticket items, dealing with individuals who you have not worked with before if you’re conscious about fraud and also when there is a delay between payment and provision of services.

Acting as a holding tank for funds, all of the titles and documentation for the sale is held by the escrow service while the transaction takes place. The process is focused on a smooth transaction for both parties.

There is a small percentage fee for the escrow agent, which is outlined ahead of the transaction being activated, services such as Escrow.com clearly outline the fees via a dedicated calculator. Should you wish for an express deposit, this is also available as an added option during the setup of the transaction.

What are the steps of an escrow process:

  1. The buyer and seller agree to the terms of transaction
  2. Buyer and seller uploads the payment to escrow service
  3. The transaction commences and the goods and service that are involved start the process of being shipped or delivered to the buyer.
  4. Buyer receives the goods and checks them, once confirmed they contact escrow service to confirm funds can be released.
  5. Funds are released by escrow service, and the transaction is complete

Using money escrow or escrow for any goods or services offers a wide range of benefits including:

  • Minimal risk of payment fraud
  • Third party protection of your funds and terms
  • Step by step online transaction that you can access 24/7
  • Funds or refunds do not need to be chased as they are held by a trusted 3rd party
  • Dispute resolution process
  • SSL protection

Fee calculators can quickly and effectively confirm the transaction fees for your escrow service and funds can be easily deposited into an escrow account via bank transfer, wire transfer, credit card, PayPal, check or money order, and all payments once cleared are held securely by the escrow service.

The escrow agreement is a firm contract that protects both parties so to ensure the funds are only released when all elements of the agreement have been met, and the goods have been received in the condition outlined in the transaction agreement.

Buyers and sellers should be aware that after the escrow agreement has been entered, the terms for holding and releasing the money cannot be altered in the absence of an agreement by all the parties.

Frequently Asked Questions

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Not sure if your transaction can be covered? Call our friendly support team on 888-511-8600 to find out