What is the role of an escrow agent during a transaction?

The role of an escrow agent is to manage the funds and documents involved in a real estate transaction on behalf of both parties—typically the buyer and the seller. This neutral third party ensures that all contractual obligations are met before the sale is finalized. The escrow agent holds the buyer's deposit and ensures that title to the property is clear, along with other essential documents. They facilitate the closing process by coordinating communication between the involved parties, collecting necessary paperwork, and ensuring all financial elements are handled correctly.

This is essential for protecting the interests of both the buyer and the seller. An escrow agent acts as a neutral intermediary, which helps to establish trust between the parties, as each side can be confident that the funds and documents will be handled according to the terms outlined in the purchase agreement. They do not represent either party in a legal capacity; hence, they do not serve as legal advisors, nor do they have a vested interest in the property value appreciation.