If you are not sure what title and escrow are in the home closing process, don’t be alarmed. Many homeowners get 
confused on what exactly these terms mean.
A title policy is an insurance policy on a piece of real estate that insures against the title deeds being incomplete or not properly searched.
A definition of escrow from the Investor Glossary:
“In contract law, escrow is a legal arrangement whereby an asset is held by a third party, called the escrow agent, for delivery from one party to another once certain conditions are met. Escrow is commonly used in high value transactions. Documents, title to real estate, software code, and of course, cash, can all be held in escrow. In real estate, the buyer’s deposit is typically held in escrow until the closing, when title is transferred. The fiduciary duty of the escrow agent is generally to the seller. The importance of picking a trustworthy escrow agent cannot be understated. There have been several cases of attorneys who, while acting as escrow agent for their client, took funds held in escrow.”
That’s a lot of words for saying escrow is basically a safe haven for the money to be held while the home sales process is taking place. As a For Sale by Owner (FSBO) home seller, working closely with the title company is critical. Always remember that title companies are your friends – they want to keep the deal on track just as much as you do.
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