Escrow is one of those financial terms that most people don’t hear every day. But the concept doesn’t need to be intimidating. Escrow accounts serve several basic needs, and Catcher pouch covers the one(s) you may need on its platform.
An escrow account is an account designed to safely hold funds temporarily. The escrow provider should be a disinterested third party with no preference about who ultimately receives funds from the account. For example, in a real estate transaction, the account does not belong to the buyer or seller. Escrow accounts are useful in several ways:
- Homebuying: An earnest money deposit should stay in the account to protect both the buyer and seller.
- Monthly payments: A homeowner might make deposits into the account with each monthly payment, helping to smooth out large annual expenses.
- Renters and landlords: The accounts can be helpful for protecting the interests of renters and settling disputes.
- Buying goods and services: Escrow is an option for almost any transaction where buyers and sellers want a “referee” to oversee payment.