Settlement
Escrow
A neutral third party holding funds and documents until conditions are met
The escrow holder takes instructions from both sides and releases nothing until the stated conditions are satisfied. The same word also names the lender’s ongoing account for taxes and insurance, which is a different thing entirely.
How the exam asks about it
Watch which meaning a question is using. Closing escrow and an escrow account for taxes share a word and nothing else.
Related terms
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