An escrow account is a temporary deposit held by a third party on behalf of two other parties, which is usually called an escrow agentю. The temporary account operates until the process of a transaction is complete and all conditions between both parties are settled. The money or other assets are debited from this account when the predetermined legal obligations are fulfilled or the escrow agent receives the instructions to release the assets.
Escrow account is designed differently than regular accounts. The major difference between an escrow account and other types of deposit accounts is its temporary nature as was opened to support a certain transaction. In addition, its management by the third party is not common among other types of deposit accounts.
