Escrow (redirected from Escrow account)

Escrow

Property or money held by a third party until the agreed upon obligations of a contract are met.

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escrow

The holding of assets (that is, securities) by a third party.

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Escrow. When someone else holds assets of yours until the terms of a contract or an agreement are fulfilled, your assets are said to be held in escrow. The assets could be money, securities, real estate, or a deed.

The person or organization that holds the assets is the escrow agent, and the account in which they are held is an escrow account.

For example, if you make a down payment on a home, the money is held in escrow until the sale is completed or the deal falls through.

Amounts you prepay to cover property taxes and insurance premiums as part of your regular mortgage payment are also held in escrow until those bills come due and are paid. In that case, you may earn interest on the amount in the escrow account.