Buying or selling a home may be the largest financial transaction of your life. When hundreds of thousands of dollars are on the line, you want to be sure that the money is safeguarded throughout the transaction. If you are the buyer, you don’t want to hand thousands of dollars in escrow directly to the seller until you are sure that the sale will close. What if the inspection showed major issues that need to be addressed before closing, or the seller decides to back out of the contract? If you are the seller, how do you guarantee that the buyer has the funds for the sale, or won’t change their mind? This is where escrow comes into the picture. What is the meaning of escrow services?

Escrow is a third-party service which handles and safeguards the money that will be transferred from the buyer to the seller upon closing of the house contract. Generally, this amount is between 1-5% of the total purchase price. The buyer gives the escrow holder this money as a demonstration of good faith for the seller to show that they intend to follow through with the purchase. The seller does not receive the money from the escrow holder until all contingencies of the contract are complete, so the buyer is also protected from losing money if something goes awry.

Once the negotiations, home inspection, paperwork, financing, and title search are complete, the contract goes to closing. At this time, the buyer and seller will sign paperwork to agree that the contract has been completed, and the escrow holder will release the funds to the seller.

When you enter into a contract to buy or sell a home, you have a choice in who handles your escrow. Escrow companies can handle just escrow, but a title company like Clear Title can handle everything from escrow services to title searches and title insurance in-house.

At Clear Title, our team of escrow experts is led by Board Certified Real Estate Attorney Stephen R. Moorhead, so you know that you and your money will be protected during escrow. With hundreds of years of combined experience, Clear Title is the clear choice for your escrow account (and title services!). If you are ready to buy or sell a home in Northwest Florida, call (850) 202-8518 or visit ClearTitleNWFL.com.