Escrow & Title
In Delaware, which of the following is TRUE about the escrow process in a residential closing?
AThe escrow agent represents the buyer exclusively
BThe escrow agent is a neutral third party holding funds and documents until all conditions are met✓ Correct
CEscrow agents in Delaware must be licensed real estate brokers
DEscrow is only required for purchase prices above $500,000
Explanation
An escrow agent (typically a title company or attorney in Delaware) acts as a neutral third party, holding funds and documents and releasing them when all contractual conditions for closing have been satisfied.
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Key Terms to Know
Escrow
A neutral third-party arrangement where funds, documents, and instructions are held until all conditions of a real estate transaction are satisfied.
Title InsuranceInsurance protecting against financial loss from defects in a property's title that existed before closing but were unknown at the time of purchase.
Abstract of TitleA condensed history of a property's title, summarizing all recorded documents and encumbrances affecting it from the earliest record to the present.
Closing CostsFees and expenses paid by the buyer and/or seller at the closing of a real estate transaction, in addition to the property's purchase price.
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