Escrow

Escrow is a process that allows a potential buyer to place an amount of money (either a down payment or the entire purchase price) in the secure hands of a disinterested third party for a set amount of time. In so doing, the buyer demonstrates to the seller the intent—and capacity—to make payment on the property. The escrow agreement establishes conditions (proof of title, etc.) for transfer of the money, and it is only when those conditions have been met that the escrow agent is obligated to hand over the money to the seller; thus buyer and seller are protected. The escrow process works slightly differently in Costa Rica from how in often works in other countries. In most other countries, the escrow agent is the employee of a bank or a dedicated escrow office. In Costa Rica, the escrow agent is often a lawyer, indeed he or she is often the buyer’s lawyer! While the buyer’s lawyer can hardly be described as a disinterested third party, that’s how things often work in this country.