Whether you are a seller, a realtor, a buyer, or a lender,
the minute you enter into an escrow agreement, you establish trust. The kind of
trust that all the terms stipulated in the contract will be upheld and that a
trusted, dependable, and unbiased third party will moderate the sale.
The third party here being the escrow agent and nothing about the agreement can be taken for granted. For this reason, escrow service becomes a very appealing option for most people, especially when transacting with strangers, transacting internationally, or transacting large amounts of money. There are several more advantages of using escrow services, and we will discuss them in this guide.
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What is an escrow account and how does It work?
Essentially, an escrow account is a holding tank. During any transaction, an escrow agent holds onto the funds, securities, property deeds, bonds or other types of documents involved between two or more parties while they work on the deal. Once all the stipulations of the agreement have been met, and all parties have delivered their end of the transaction, escrow releases the funds and documents to the right parties.
The escrow agents’ job is to ensure that the transaction runs smoothly and everyone gets what they are owed. The escrow service also has to deduct small percentage of the transacted cash, an escrow fee that is usually 1% to 3% of the funds transacted. One of the biggest advantages of using escrow services is that everyone is satisfied with the transaction.
An escrow account works very easily. All parties involved need to open an account with a legitimate escrow services website, and one of the parties has to start the process. For instance, if it is a buyer-seller transaction, the buyer has to send the funds to the escrow service first. The escrow agent notifies the seller so that they send the goods to the buyer.
Once the buyer receives the goods and verifies with the escrow agent, the funds are released to the seller. One of the most incredible advantages of using escrow services is that no one is conned. If by any chance the buyer is not satisfied with the goods, they have to send them back to the seller and get the money back from the escrow agent.
Escrow services provide a safety net for all parties involved
One of the reasons why most people use escrow services is because all the times of the transaction agreement must be met before any money, document, or properties exchange hands. The escrow agent ensures that everything is in order and everyone has held the end of the deal before releasing whatever it is they are holding. The buyer and the seller are both protected by the escrow services with a safety net but nothing can go wrong, and no one will be deceived.
For instance, at EscrowKenya, not only do they offer customers with top security, but also all their transactions with their agents come with a first-class customer service. They care about their clients, and they are always on the lookout for everyone's interests. With EscrowKenya, even during the toughest transactions, the communication is always effective, and the process closes with all parties satisfied.
Protection against fraud
All escrow companies have rules and guidelines that protect clients against fraud. All transactions are usually verified. In addition to this, the escrow companies are regularly audited by governing bodies to ensure neutrality and fairness in the agreements. For this reason, you can easily trust an escrow service with your money, documents, or other securities without having to worry about fraud. Of course, you need to work with a trustworthy and legitimate escrow service company to protect yourself against fraud.
Advantages of escrow services for real estate agents
Real estate agents sell homes all the time, and they need a system that protects them against scrupulous buyers who may obtain instruments through fraud or even misrepresent themselves. An escrow account is essential for both the agent and the buyer because it will protect both parties given the fact that they are transacting large amounts of money.
Advantage of escrow services for buyers
An escrow service confirms with the buyer of the shipped goods and verifies them. International trade especially can be very complicated, but an escrow service makes it easy because no payment goes to the seller until the buyer accepts the merchandise. The buyer also gets an inspection period to verify that what they received is what they ordered. Escrow shipping becomes very easy because it eliminates any possibilities of fraud, or delivery or wrong products.
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Advantages of escrow services for sellers
When it comes to sellers, you are authorized to send the merchandise when the escrow service verifies the funds. On top of that, escrow services confirm that the buyer has received the merchandise.
Bottom Line
These are some of the advantages of using escrow services, and as you can see, these services are well worth it. It does not matter what kind of transaction you have. If you are selling or buying a car, then an escrow service will protect you from being cheated.
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