Sonstiges » Pros and Cons escrow account

Depending on the transaction area, it is assumed that both parties involved can benefit from escrow services. When discussing business transactions, both parties should exercise care in selecting an appropriate and trustworthy trustee. Since the funds are held by the third party, both parties involved must be able to rely on their assets as they will be released when needed.

With real estate, the assumption is that the buyer or borrower is in a worse position than the seller or lender. As with regular deposits along with mortgage payments, the lender must lock up their money rather than invest it, earn a return, and pay taxes or insurance if necessary. In addition, it could be difficult for people with fluctuating incomes to guarantee equal payments every month.

It is worth noting that while this option does not allow investing their funds, this option is usually used by trustees who earn not only from service fees, but also by investing in short-term financial instruments.