WHAT IS TITLE & ESCROW?

Title and escrow are two distinct but closely related components of real estate transactions.

The title refers to a property's legal ownership and rights. When a property is bought or sold, a title search is conducted to determine if there are any existing claims, liens, or encumbrances that could affect the ownership or use of the property. A title company or attorney typically handles this process to ensure that the title is clear and can be transferred to the new owner.

On the other hand, escrow is a financial arrangement where a neutral third party, often an escrow company, holds funds and documents on behalf of the buyer and seller during a real estate transaction. The escrow agent ensures that all conditions and requirements of the sale are met before the funds are released and the title is transferred to the buyer. This process provides a level of security and protection for both parties involved in the transaction.

In summary, title involves the legal ownership and rights associated with a property, while escrow is a financial arrangement that ensures a smooth and secure transfer of funds and documents during a real estate transaction.