Escrow Accounts/Earnest Money


Details on escrow accounts (from the basics to escrow administration) and earnest money, as well as information on escrow fraud.


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Eight Earnest-Money Deposits Mistakes Home Buyers Live to Regret

  1. Not understanding what an earnest-money deposit is
  2. Not offering enough, or too little
  3. Eliminating contract contingencies
  4. Neglecting contract timelines
  5. Buying "as is"
  6. Carelessly voiding the contract
  7. Purchasing a home on impulse
  8. Letting personal problems get in the way of a purchase

Source: Eight Earnest-Money Deposit Mistakes Home Buyers Live to Regret (, Feb. 21, 2017)

Escrow Accounts

Homebuying Process (FannieMae, 2018)

FAQs About Escrow Accounts for Consumers (U.S. Department of Housing and Urban Development, 2018)

Common Closing Costs for Buyers (REALTOR® Magazine, Handouts for Consumers, 2018)

How the Term Escrow Relates to Your Real Estate Transaction (, 2018)

Escrow Account—Everything You Need to Know (Mortgage-x Blog, 2018)

More Consumers Make Use of Escrow Accounts (REALTOR® Magazine, Jun. 26, 2017)

Escrow Administration

What is Escrow Management? (wiseGEEK, 2018)

Administering an Escrow Account and Paying Expenses (Fannie Mae, Mar. 14, 2018)

Tax Data Errors Among Top Consumer Gripes (REALTOR® Magazine, Apr. 12, 2016)

Realtors FCU Lobbies Successfully for Real Estate Escrow Accounts (Credit Union Journal, Mar. 16, 2016) E

Earnest Money Deposits

6 Extra Costs in a Home Buyer's Budget (REALTOR® Magazine, Nov. 14, 2017)

Suddenly, the Seller Won’t Sell!  Not to You. What Do You Do? (The Washington Post, Jun. 23, 2016) E

Escrow Fraud and Real Estate

Mortgage Scams: Real Estate Closing Fees Kickback Scams (Fraud Guides, 2018)

Mortgage Company President Pleads Guilty to $2.5M Fraud (The Canadian Press, Oct. 5, 2017) E

Identity Crisis: Choice Escrow & Land Title, LLC and the Rising Risks of Fraudulent Wire Transfers (DePaul Business and Commercial Law Journal, Apr. 1, 2016) E

Title Company Accused of Stealing Funds (REALTOR® Magazine, Feb. 16, 2016)

Don't Be a Victim of Loan Fraud (U. S. Department of Housing and Urban Development, 2014)

Case Summaries - Escrow Mishandling

Broker wins lawsuit over escrow retention Estate of Kupperstein v. Baum, No. 1147SC0518 (National Association of REALTORS®, Legal Case Summaries, Mass. Dist. Ct., Mar. 5, 2013)

Escrow company liable for attorney’s fees Kangarlou v. Progressive Title Co., Inc., 27 Cal. Rptr. 3d 754 (Cal. Ct. App. 2005)

Seller's creditor cannot garnish escrowed funds General R.A.C., Inc. v. Coldwall Banker Residential Real Estate, Inc., 876 So. 2nd 606 (Fla. Dist. Ct. App. 2004)

Broker liable for failing to follow escrow agreement Int'l Capital Corp. v. Moyer, No. 1-02-2401, 2004 WL 438976 (Ill. App. Ct. Mar. 10, 2004)

Real estate commission reversed Djokic v. Dep't of Bus. & Prof'l Regulation, Div. of Real Estate, 875 So. 2nd 693 (Fla. Dist. Ct. App. 2004)

Licensee punished for withholding escrowed funds Hayber v. Dep't of Consumer Prot., No. CV020513973S, 2004 WL 574662 (Conn. Super. Ct. Mar. 8, 2004)

Filing disciplinary complaint does not violate bankruptcy protections McMullen v. Sevigny (In re McMullen), 386 F.3d 320 (1st Cir. 2004)

Lawsuit against escrow agent over depository bank failure proceeds Bazinet v. Kluge, No. 110143/01, 2003 WL 21361746 (N.Y. Sup. Ct. May 29, 2003)

Escrow company liable for attorney's fees Kangarlou d v. Cleveland, No. 02AP-485, 2002 WL 31870134 (Ohio Ct. App. Dec. 24, 2002)

No breach of fiduciary duty by buyer's representative who did not pay deposit to seller Ballard v. Cleveland, No. 02AP-485, 2002 WL 31870134 (Ohio Ct. App. Dec. 24, 2002)

In Alabama, appraisers can be liable to third parties for negligent misrepresentation Fisher v. Comer Plantation, Inc., 772 So.2d 455 (Ala. 2000)

New York broker stripped of license for claiming an unearned commission In the Matter of Emil T. Pagano and Irene F. Baker Real Estate Agency, 77 D.O.S. 99 (Apr. 12, 1999)

Release contained in cancellation agreement is invalid Johnson v. Maki & Assoc. , 289 Ill. App. 3d 1023, 682 N.E.2d 1196 (Ill. Ct. App. 1997)

eBooks & Other Resources

The following eBooks and digital audiobooks are available to NAR members:

American Mortgage - Everything You Need to Know About Purchasing and Financing A Home (eBook)

Busted - Life Inside the Great Mortgage Meltdown (Audiobook)

Chain of Blame - How Wall Street Caused the Mortgage and Credit Crisis (eBook)

The Complete Idiot’s Guide to Mortgages (eBook)

Decoding the New Mortgage Market (eBook)

Fast Track Your Mortgage (eBook)

How to Save Thousands of Dollars on Your Home Mortgage (eBook)

How to Sell a House When It is Worth Less than the Mortgage (eBook)

Insider Secrets to Financing Your Real Estate Investments (eBook)

The Insider's Guide to Home Equity Borrowing (eBook)

An Insider's Guide to Refinancing Your Mortgage (eBook)

The Little Black Book of Wealth Building Mortgage Secrets (eBook)

The Mortgage Answer Book - Choosing the Right Loan for You (eBook)

The Mortgage Encyclopedia (eBook)

Mortgage Myths - 77 Secrets that will Save You Thousands on Home Financing (eBook)

Mortages 101 (eBook)

The new rules for mortgages (eBook)

The Pocket Mortgage Guide (eBook)

Reverse Mortgages for Dummies (eBook)

Salomon Smith Barney Guide to Mortgage-Backed and Asset-Backed Securities (eBook)

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