The term Escrow is a fairly commonly used term in real estate transactions. It is a mechanism to allow for transfer of property from the seller to the buyer using a third party. All the activities related to escrow are carried by an individual known as the escrow agent. Closing of an escrow is synonymous to the term closing of a real estate transaction. It signifies the legal transfer of the property from the seller to the buyer. Essentially the closing agent or the escrow agent acts as the custodian of all the monetary and paper transactions that are needed to close the real estate deal. The seller of the property would transfer the title of the property to the escrow agent. Similarly the buyer of the property would organize to transfer his personal equity and mortgage related funds to the escrow agent. The escrow agent would transfer the title of the property to the buyer and arrange to provide all the funds to the seller in accordance with the sale agreement. The escrow arrangement provides a neutral third party which ensures compliance to the agreement between the buyer and seller for a high value transaction such as a property deal.

Everything related to closing of an escrow is handled by a closing agent. A closing agent usually performs the role of an escrow agent as well. He does not represent the buyer, the seller, real estate agent or the mortgage institute. A closing agent is a person or business entrusted with the responsibility of coordinating all the activities required for sale closure which in other words is also called closing of an escrow. The closing agent must ensure that all documents and records are completed properly. He also makes sure to disburse the funds to the seller.

During the closing session of the transaction, the closing agent would ensure and certify with the help of the buyer and seller that all papers related to agreement and property are in order. This would mean necessary checking with respect to documents being signed at the right places, witnesses being included and photocopied document available to all the parties. The closing agent would then make sure that the payment of all the closing costs, deposits, insurance premium receipts in accordance with the provisions of the agreement. During closure, the funds from the buyer are collected by the agent but not made available to the seller until the sale transaction has been recorded.

Once the closing session is over, the closing agent would get the deed and mortgage registered with the applicable courts. Once the government records are updated, the original deed is provided to the new owner while the mortgage document is provided to the lending institute. The funds held under the custody of the escrow agent are released to the seller once the recording process is complete. The formal process of sale closure comes to an end and is commonly known as closing an Escrow in real estate world.