Escrow agreements are frequently used in real property transactions. Attorneys-at-law routinely act as escrow agents so the buyer can perform due diligence, such as an inspection, on his potential acquisition while assuring the seller of his capacity to close on the purchase.
Under an escrow agreement, money, property, or a bond put is into the custody of a third party for delivery to the seller only after the fulfillment of the conditions specified.
The escrow agreement normally includes the identity of the appointed escrow agent, the escrow funds and detailed conditions for the release of these funds, the acceptable use of funds by the escrow agent, the duties and liabilities of the escrow agent, the escrow agent’s fees and expenses, and the jurisdiction and venue in the event of a legal action.