What Is an Escrow Fee?

Introduction

The escrow fee pays for the escrow or title company that acts as a neutral third party during the closing process. They hold funds and documents, coordinate with all parties, and ensure conditions are met before releasing money and transferring ownership.

This is different from an escrow account (impound account), which holds funds for property taxes and insurance after closing. See What Is Escrow and What Are Closing Costs.

Frequently Asked Questions

What is an escrow fee?

The escrow fee pays for the escrow or title company that holds funds and documents during the closing process. They ensure all conditions are met before releasing money and transferring ownership.

How much does escrow cost?

Escrow fees vary by state and transaction size. They often range from a few hundred to over a thousand dollars. The fee may appear under "Services You Can Shop For" on your Loan Estimate.

Can I shop for escrow?

In many states, yes. Escrow and title services are often shoppable. Compare quotes from different companies to potentially save money.

Is escrow fee the same as escrow account?

No. The escrow fee is a closing cost for the closing process. An escrow account (or impound account) holds funds for property taxes and insurance after closing. See What Is Escrow for the account.