An escrow is an arrangement on which a neutral third party, called an escrow holder, holds legal documentation and funds on behalf of a buyer and seller. The escrow agent works closely with you, your realtor and lender to assure that the sale conditions are complied within the time period called for in the Residential Purchase Agreement and Joint Escrow Instructions. After all parties have executed these documents, escrow prepares an Addendum to the Residential Purchase Agreement and Joint Escrow Instructions. Escrow then distributes them according to the buyers and sellers instructions. Both the buyer and the seller rely on the escrow holder to carry out faithfully their mutually consistent instructions relating to the transaction. Escrow holder is bound by law to notify both parties if the instructions given are not mutually consistent or cannot be carried out. These instructions are drawn by the Escrow Officer, and signed by the buyer and seller. Since the escrow instructions are not as detailed as the Purchase Contract, the information contained in the instructions is intended to direct the Escrow Officer in the specific steps that are to be completed through the escrow instruction.