Escrow is a neutral third-party hired by home buyers and sellers to facilitate the closing of a real estate transaction. The escrow company is tasked with executing the terms of the purchase agreement.

Escrow companies are responsible for signing closing documents, verifying payoff amounts for existing mortgages and liens, collecting all monies due and disbursing the funds when a transaction is complete.

In some instances escrow is handled by the same company that issues title insurance, but in some cases they can be separate companies.