The term 'escrow' could well be a relatively new one in several parts of the world, especially in the developing and under developed nations. The use of an escrow service is intended not only to take care of the ease of management of funds during a property purchase or sale, but also to cater to expenditure that may be required for all the administrative work that is usually called for in order to execute the closing of a real estate property deal. In fact, in places where an attorney is not required to be playing a role in a real estate property purchase, the escrow agent takes on the vital role of the central party who is responsible for ensuring that all the documentation is in order before the closing of the deal.
In the Republic of Costa Rica, the escrow agent performs a similar role. The primary function of the escrow agent is to provide financial management service which is a necessary precaution to prevent mishandling or manipulation of funds prior to the closing of the deal. The escrow agent also is a neutral third party in the entire transaction who is entrusted with the responsibility for issuing checks to the relevant party and executing appropriate payments. This system instills confidence in all the associated parties like attorneys, brokers as well as the seller that funds are available and ready to be disbursed any time. They hence feel protected during the buying process and secure in the thought that all the funds will be disbursed appropriately and promptly to all relevant parties at the time of closing of the deal.
On realizing the advantages of using this feature, more and more deals are being closed with the support of escrow services. Soon after the property to be purchased has been identified, it is now a common practice to put the necessary funds into escrow so as to ensure the smooth transition of the deal across various phases. Doing so also saves time since this allows separate parties to act independently and efficiently towards the closing of the deal. Noticing this potential, several new escrow service providers have come to the fore in Cost Rica; a small percentage as fees may be chargeable to those using this escrow service, by the escrow service provider.
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