Escrow is a financial arrangement in which two parties enlist a “third party” (who is neither the buyer nor the seller) to temporarily hold money, paperwork, or other assets for a transaction on their behalf before the transaction has been finalized.

That third party, known as an escrow provider, helps make the transaction safer by protecting the assets of the buyer and seller until both parties have met their obligations for the agreement. Ideally, the escrow provider is a neutral third party who isn't concerned with whether the buyer or seller comes out ahead.