There are certain situations when you need to make significant transactions, but you are not sure if the other party is trustworthy. This mostly happens when you are dealing with a stranger, or when doing a business transaction. Most e-commerce transactions are straightforward, but only when dealing with established businesses such as Amazon, Jumia, and the like. However, it gets challenging when you must deal with people directly.
The more money you are transacting, the higher the risk. An escrow service is what you need because it eliminates the risks involved, builds trust between you and the other party, and ensures all transactions run smoothly. Understanding how online escrow services work, and how you can become a part of it will help you resolve tricky situations.
What is escrow?
Escrow means a legal concept where a third-party holds the financial instruments or assets for two parties. Escrow services regulate funds involved in the transaction, ensuring security by keeping the funds in a neutral ground. It is only after all the terms and conditions of the agreement are met, that escrow releases the funds.
An escrow service is of extreme importance, especially if the transaction involves a considerable amount of money and both parties don't trust each other. Payments done through escrow services are safe with very minimal risk of loss or fraud. As a result, the security during transactions is increased, and there is an elimination of legalities. This is how online escrow services work, and they are an excellent option for most people.
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How Does Escrow Work
Escrow services collect the payment and hold on to it until both parties are
fully satisfied. By offering these services, they minimize the risks of being
conned and increase both security and confidence. Here is a step by step guide
on how the transaction takes place.
The buyer and the seller need to create
an escrow account. Both parties must agree to the terms of the arrangement,
and then either party can start the transaction process.
- The buyer sent the money to escrow services.
- Escrow verifies the payment.
- The seller is notified that the money has been secured.
- The seller sends or ships the merchandise
- The buyer confirms delivery( the buyer sets some days for inspection
of the items and has an option to accept or reject)
- If the buyer accepts the merchandise, Escrow releases the funds to the
seller
- In case the buyer rejects the merchandise, the process goes back in
reverse, and when the seller received the merchandise back, escrow releases the
money back to the buyer
During this process, the service provides notifications to both parties alerting them on the exact stage of the process. If there are any items required from one party, they are notified so they can act upon it. With an escrow service, you don't have to wonder where you are with the transaction.
How Long Does The Escrow Process Take?
The process highly depends on several aspects, such as:
- The buyer payment methods
- The time set aside for merchandise inspection.
- Delivery time of the goods.
- Whether the buyer is satisfied with the products.
In general, though, it could take anywhere between 5 to 20 days.
Do Escrow Services Agree to all Kinds of Transaction?
Most escrow services have certain limitations, especially when it comes to real estate, munitions, firearms, or currencies. They might also refuse to complete transactions if the transactions seem unauthorized, violate the law, or violate the service rules and regulation.
Escrow Services Fees
Best school fees depend on the escrow services you use, as the transaction amount. Most escrow services charge reasonable fees, and it is well worth it depending on the security they offer.
Escrow Kenya Company
Escrow Kenya is a fully licensed and bonded secure online escrow company that holds onto funds on neutral grounds as a third party. When you perform transactions on EscrowKenya, you are assured of top security that protects you from charge-back, scammers, and wrongly described merchandise. If you need verification that your money has reached the right person, or a service that will ensure you don’t lose the money to fraudsters, EscrowKenya.com is the answer.
Why Use an Escrow Service?
There are dozens of payment options available going from bank transfers, checks, money orders and more. With all these options, why would anyone opt for escrow services? While most of these services are tried, tested, and right, escrow services offer exclusive advantages. For instance, if you are the seller, then you are assured of the payment even before you send your merchandise to the buyer. If you're a buyer, you first receive the merchandise and ensure it is as it should be before the seller gets the money.
Escrow Payment Options
Most escrow services include a variety of payment options, including bank wire transfers, PayPal, credit cards, money orders, and cheques. Different types of methods may have certain limitations, such as maximum amounts or additional fees. Escrow Kenya also offers and escrow M-pesa option, and makes the transactions a lot easier.
Types of Escrow Accounts
- Real Estate Accounts- Lenders usually require real estate’s escrow
services to ensure payment of taxes and insurance. It is also advantageous for
small businesses to own and maintain escrow accounts to even out cash flow in
the business. These accounts are usually set up by the lender and the provide
statement to the property owners showing the amounts they have deposited.
- Holding Client Funds- This is the most popular account where buyers
and sellers put their money on hold until the completion of the transaction.
Landlords also maintain escrow accounts where the tenants pay the deposit.
- Tenant Accounts- When tenants and landlords are having a dispute,
tenants can pay the rent through an escrow service. Of course, the tenant must
notify the landlord that by using an escrow service.
- Other Issues- There are many different situations people need escrow
services contract disputes, such as contract disputes the selling of businesses,
and even legal actions.
READ ALSO: How to Buy A Car on Cheki.co.ke
How to Set Up an Escrow Account
Setting up an escrow account is easy. Just open the escrow website, such as the Escrow Kenya website, hit the sign-up button, and register an account. You are required to fill out some necessary information that will assist with your transactions. Most people who want to know how online escrow services work tend to think it’s a complicated process, but on the contrary, it’s simple and straightforward.
Bottom Line
As you have seen, this is how online escrow services work, and they are some of the most sure and trusted transaction options. The advantages of escrow services make it a trustworthy choice, and they eliminate the risks and fear of being conned.
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