May 27, 2020

What is the Difference Between Title and Escrow?

What is the Difference Between Title and Escrow?

In the real estate industry, the words "title" and "escrow" are often used interchangeably, but the truth is they are two different parts of the real estate transaction. Learn more about these services and how SMART handles both in our settlements.



The word "title" refers to your legal rights to own, use, and dispose of a specific property. The title company insures the property's title with policies to the buyer and the lender to protect against problems with the property or the title.


Escrow is the arrangement of one company holding and managing the payment of funds required for two parties in a given transaction. The escrow company or agent acts as the objective third-party between the buyer, seller, and lender to make sure that the contract (offer) is closely followed and that the money goes to all of the correct places when terms of the contract are met.

Like many title companies, SMART Settlements handles both title and escrow services for our clients.


  1. The title agent researches the history of the property being purchased and transfers the actual property ownership between the seller and the buyer.
  2. The escrow agent manages all crucial documents that are required to close. They work with both parties to prepare transaction documents, and they coordinate with the lender. They also oversee the finances involved in the real estate transaction including the loan, closing, and recordation.

In short, the title agent gathers and researches the transaction while the escrow agent executes according to the terms of the contract.


The professionals involved in closing transactions vary from state to state.

A real estate transaction in DC, Virginia, or Maryland is closed by a licensed title agent. This licensed agent, in many cases, is also an attorney. This professional is licensed to speak about title insurance and will witness and counter-sign a number of documents with the parties at settlement.

This title agent is typically a notary as well and will notarize the settlement documents at closing.

SMART is pleased to have experienced real estate attorneys and title agents on staff who help to manage the title and escrow process from start to finish.

All of SMART's title closing agents are licensed for DC, Virginia, and Maryland.

For additional information on this topic contact Evelyn Miller, Partner, at 202-753-7400.

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