Page 10 - Homeowners Manual - Monterey - Carmel
P. 10
Escrow
WHAT IS ESCROW?
Making a very large purchase, such as a house, causes buyers, sellers and lenders to seek reassurance about
all the security measures that are in place to protect the funds involved in the closing transaction. Transferring
large sums of money and finalizing the details of your sale needs to be done safely and in compliance with
the latest security and privacy standards. To help minimize risks during real estate transactions, the escrow/
settlement process was developed to protect the buyer, seller and lender.
An escrow account is basically a temporary pass through account held by the escrow holder. The escrow
holder is a neutral third party that holds funds and related documents in a secure manner while the parties
work through the details of the real estate transaction. Escrow ensures the conditions of the real estate
transaction have been met before the property and/or money change hands.
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