Escrow provides a neutral third party between the buyer and seller during a property transaction. When property changes hands, the buyer and seller select an escrow company to serve as an intermediary that securely holds the property documents and funds while all final paperwork is being processed and completed.

In most cases, the escrow fee is divided equally between the buyer and seller.

The fee for a standard residential transaction is calculated using a set fee schedule based on the property's sales price. Nonstandard situations or transactions with additional complexity may result in higher fees.