What is an Escrow Deposit?

The Escrow Deposit is good faith consideration from the Buyer to be held in Trust account by a third party until the closing of the property when it is turned over to the Seller as part of the Buyer's downpayment.  The Trust account is a third party that manages how and when the funds are disbursed. This Trust account is generally held by the Title Company, although some real estate brokerages do have an escrow account to hold the escrow deposit. The real estate contract details what happens with these funds through the process of the transaction and in the event of default by the Buyer.