Escrow

Definition

An agreement that money or other objects of value be placed with a third party for safe keeping, pending the performance of some promised act by one of the parties to the agreement.

It is common for home mortgage transactions to include an escrow agreement where the borrower adds a specified amount for taxes and hazard insurance to the regular monthly mortgage payment.

The money goes into an escrow account out of which the lender pays the taxes and insurance when they come due.

For articles on this subject, see Escrows.

Related Terms

Other terms related to 'Escrow' starting with the letter 'E'

Equity grabbing, Equity, Effective rate

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