What is the role of an escrow agent in a property transaction?

The role of an escrow agent in a property transaction is pivotal for ensuring a safe and smooth transfer of property between buyers and sellers. An escrow agent serves as a neutral third party responsible for holding and managing funds and documents related to the transaction. This responsibility includes collecting earnest money deposits, holding the deed to the property, and ensuring that all terms and conditions of the purchase agreement are fulfilled before the property changes hands.

By holding these funds and documents until all conditions of the sale are met, the escrow agent helps protect the interests of both parties. For example, the buyer can be assured that their funds will not be released until they receive the title to the property, while the seller can be confident that they will receive payment upon completion of the transaction.

Other roles mentioned, such as facilitating price negotiations, providing legal counsel, or transferring ownership directly, do not fall under the responsibilities of an escrow agent. Negotiating a sale price is typically handled by real estate agents, whereas legal counsel is provided by attorneys. The actual transfer of ownership is executed through the settlement process, which involves the escrow agent but does not occur directly through them. Thus, holding funds and documents until the conditions of the sale are met accurately describes the central function of an escrow agent in