Secured Trust Escrow
Loading..

Sale or Purchase a Business With an Escrow Agent

October 27, 2022
The Function of an Escrow Agent in the Sale or Purchase of a Business

Escrow Agent For Businesses –

Those who have purchased or sold a home are undoubtedly familiar with the term “escrow.” When it comes to the purchase or sale of a business, an escrow is more than just an account where funds are held until the deal is finalized. Escrow plays various crucial services in the transfer of a business, and the choice of whether or not to cooperate with an escrow agency is a crucial aspect in the selling of a firm.

An escrow agent is a person or organization that is responsible for holding all funds and documents until the terms of the escrow are met. Occasionally, they are also known as settlement agents, closing agents, and escrow officers. Escrow is typically required when third-party financing (such as bank borrowing) is involved.

The escrow agent assures regulatory compliance, prepares normal transaction documentation and closing statements, and efficiently manages administrative issues. Escrows are utilized widely by transactional attorneys and intermediaries to safeguard the interests of both buyers and sellers.

Responsibilities of a Business Escrow Agent

In the selling of a business, escrow plays numerous essential responsibilities. The principal responsibilities of an escrow agent include:

  • Keeping the first down payment. Individual buyers are more likely to provide earnest money deposits than corporate buyers.
  • Ensure that assets are transferred with a clear title at the closing
  • Being a clearinghouse for the settlement of liens, debts, and other bills
  • Withholding and disbursing funds

An escrow agent is a neutral third party who acts only in accordance with mutually agreed-upon instructions. This is crucial because escrow agents frequently store significant amounts of cash during different phases of a transaction, and it is essential that a third party keeps these monies. Contact us now if you’re looking for a top rated escrow agency in Los Angeles, CA.

Recent posts
Distressed Loan Escrows: California's Workout Solution
With $14 billion in California commercial loans now delinquent and special servicing rates hitting 8.2% in Q2 2025, distressed loan escrows have become the essential alternative to foreclosure. At Secured Trust Escrow, California's leading workout escrow provider, we've successfully restructured over 280 troubled loans through specialized accounts that create breathing room for borrowers while protecting lender interests.
Green Building Escrows: California's Green Transformation
California's commercial real estate sector faces unprecedented regulatory pressure in 2025, with new energy codes demanding 30% emissions reductions and water conservation mandates requiring 45% reductions by 2026. At Secured Trust Escrow, California's premier green building escrow provider, we've facilitated over $42 million in sustainable upgrades through specialized escrow accounts that ensure compliance while protecting investments.
Click Here To Call