### What is the primary role of an escrow company in a real estate transaction? - [x] To act as an independent third party ensuring all parties meet their obligations - [ ] To provide loans to buyers - [ ] To appraise the value of the property - [ ] To conduct property inspections > **Explanation:** An escrow company acts as an independent third party that ensures all parties fulfill their obligations before a real estate transaction is completed. They hold funds from one party and only release them when all conditions are met by both parties. ### Why is the escrow company important in real estate transactions? - [ ] They determine the selling price of the property - [x] They provide confidence to both buyer and seller and ensure no party takes advantage of the other - [ ] They conduct title searches - [ ] They provide mortgage financing > **Explanation:** The escrow company is crucial because it provides both the buyer and the seller with the confidence that no party will take advantage of the other. They ensure all conditions are met before releasing any held funds, facilitating a smooth transaction process. ### What does the escrow company typically charge for their services? - [ ] A large commission on the property sale - [ ] No fee, their services are free - [x] A small fee for facilitating the process - [ ] A percentage of the loan amount > **Explanation:** The escrow company charges a small fee for their services. This fee covers their role as a neutral referee in ensuring all conditions of the transaction are met. ### When does the escrow company typically release the held money in a transaction? - [x] Once all conditions are met by both sides - [ ] After the buyer's loan is approved - [ ] When the buyer makes the initial deposit - [ ] After the property inspection is complete > **Explanation:** The escrow company releases the held money only once all conditions specified in the real estate transaction agreement are met by both sides. This ensures the security and fairness of the transaction. ### How does the escrow company contribute to the real estate transaction process? - [x] They act as a neutral referee ensuring all obligations are fulfilled - [ ] They provide legal advice to the buyer and seller - [ ] They handle the marketing of the property - [ ] They give mortgage loans directly to the buyer > **Explanation:** By acting as a neutral referee, the escrow company ensures that all obligations specified in the transaction are fulfilled before any funds are transferred, which contributes to the integrity and smooth operation of the real estate transaction.