How are funds in an escrow account typically treated until the deal is finalized?

Funds in an escrow account are generally kept on deposit until the transaction is finalized. This means that the money is held securely by a neutral third party—the escrow agent—who manages the distribution of the funds according to the terms of the contract. The purpose of this arrangement is to ensure that both parties in a transaction fulfill their obligations before the funds are released. Keeping the funds on deposit helps provide peace of mind to both parties involved, ensuring that the money is available for the agreed-upon use once all conditions of the sale are met. This practice fosters trust and security in the transaction process, as the funds are protected until all necessary actions and agreements are satisfactorily completed.